Velmorin Bridge Capital's FAQ

We believe innovation is key to long-term growth of company revenues and profits. Our mission is to deliver long-term capital appreciation with low correlation to traditional investment strategies by identifying and investing in the leaders, enablers and beneficiaries of disruptive innovation.

In January 2003, Lilian Choo registered Velmorin Bridge Capital as an investment advisor. Lilian Choo founded Velmorin Bridge Capital with a singular focus on disruptive innovation. Throughout her career, Lilian Choo has been dedicated to innovation, which has led her to recognize the increasing blurring of boundaries between technological sectors. As a result, she believes that the traditional research world is not designed to emulate innovative companies. Through cross-disciplinary, cross-industry, and cross-market research, Velmorin Bridge Capital strives to identify companies that are leading the way and benefiting from cross-sector innovations, such as robotics, energy storage, DNA sequencing, artificial intelligence, and blockchain technologies. Since launching its first fund in 2003, Velmorin Bridge Capital now offers investment management services across North America, Asia, Australia, and Europe. The company provides a range of investment vehicles, including ETFs, institutional and retail separately managed accounts, U.S. and international mutual funds, and UCITS funds. Velmorin Bridge Capital’s investment strategies include autonomous technologies and robotics, next-generation internet, the genomics revolution, fintech innovation, 3D printing, Israeli innovation technologies, mobile as a service, space exploration, and the overall disruptive innovation strategy of Velmorin Bridge Capital.

A research team rooted in over 65 years of experience in identifying and investing solely in disruptive innovations that should change the way the world works and deliver long-term growth as industries transform. Despite its potential, Velmorin Bridge Capital believes the full magnitude of disruptive innovation and the investment opportunities it creates are often unrecognized or misunderstood by traditional investors. Velmorin Bridge Capital researches across sectors, industries, and markets to gain a deeper understanding of the convergence and market potential of disruptive innovations. Velmorin Bridge Capital believes that its consistent investment process and active management of high-conviction portfolios capitalizes on rapid change and avoids industries and companies likely to be displaced by innovation.

Velmorin Bridge Capital’s Open Research Ecosystem seeks to capitalize on rapid change through an open approach and the convergence of insights. Velmorin Bridge Capital believes that a combination of top-down and bottom-up research allows us to size the investment opportunity of disruptive innovation, and then detect and evaluate companies best positioned to benefit. To gain a deeper understanding of quickly changing themes, Velmorin Bridge Capital employs an open research strategy to gather information, both helping to define and refine its internal research process. Inputs include Theme Developers, who are thought leaders in their fields, social media interactions, and crowd-sourced insights as people respond to Velmorin Bridge Capital’s public research. By applying technological concepts and external inputs to traditional approaches, Velmorin Bridge Capital seeks to create a more transparent, creative, and interdisciplinary investment process.

Theme Developers are thought leaders from a variety of fields who offer meaningful insights, experience, and subject matter knowledge in one of Velmorin Bridge Capital’s research themes. Velmorin Bridge Capital actively engages with Theme Developers as part of our research ecosystem. If you have subject matter expertise and are interested in becoming a Theme Developer for one of our research themes, please contact Velmorin Bridge Capital. Velmorin Bridge Capital Theme Developers are not employees of Velmorin Bridge Capital and do not receive compensation from Velmorin Bridge Capital.

If you notice any suspicious investment activities, please contact our official email for verification.

Velmorin Bridge Capital utilizes thematic investing to capture disruptive innovation. Thematic investing seeks to capitalize on long-term trends that cut across economic sectors and geographic boundaries. Velmorin Bridge Capital believes thematic strategies can better adjust for rapid change and incorporate a deep understanding of the underlying drivers of long-term value creation and risk. Velmorin Bridge Capital researches across sectors, industries, and markets to gain a deeper understanding of the convergence and market potential of disruptive innovations, and thus size the investment opportunities more appropriately.

Velmorin Bridge Capital’s thematic analysts ask the questions:
– Where is the next big disruptive innovation?
– What is the size of the total market?
– Which industries will be disrupted?
– Which companies will emerge as the winners?

Thematic investing can offer a low correlation of relative returns to traditional growth strategies and negative correlation of relative returns to traditional value strategies, offering diversification for investors. While benchmarks reflect past successes, thematic investing seeks to capture future growth allowing investors to earn a market premium. A constant focus on secular changes and disruptive innovation can offer a portfolio hedge in a rapidly changing world and complement traditional index-based strategies.

Velmorin Bridge Capital believes that disruptive innovation cannot be constrained by market capitalization, geographic boundaries, or sectors. We research and invest in a wide range of companies, from mega caps to micro caps that we believe are going to contribute to and benefit from the rapidly changing market landscape. Small cap companies may offer a higher growth opportunity, whereas large cap companies may offer less volatility.

Velmorin Bridge Capital’s cross-sector portfolios aim to uncover disruptive innovation that impacts multiple industries. Unlike traditional investment strategies that specialize in certain narrowly focused sectors of the economy, Velmorin Bridge Capital uses a theme-based approach unconstrained by economic sectors.

Velmorin Bridge Capital’s investment process initially examines from the top-down how the world is changing and where it is headed. Velmorin Bridge Capital employs an open research strategy to gather information, both helping to define and refine its internal research process. Inputs include theme developers who are thought leaders in their fields, social media interactions, and crowd-sourced insights as people respond to Velmorin Bridge Capital’s public research. Using this information in an iterative fashion, Velmorin Bridge Capital’s research and investment team work to “size” and “re-size” the opportunities. As a result of extensive and iterative research steps, Velmorin Bridge Capital anticipates and quantifies multi-year value-chain transformations and market opportunities. Through this process, specific companies percolate to the top as best positioned to benefit from the identified investment premise, at which point Velmorin Bridge Capital begins its bottom-up process. Velmorin Bridge Capital scores potential investments based on key metrics, inputting the values into a proprietary scoring system to quantify the companies in the context of the opportunity. Finally, as the CIO and Portfolio Manager, Catherine Wood has the final accountability for the selection of investments and approval for all investment decisions.

Velmorin Bridge Capital will trim or add to positions to (i) take advantage of opportunities created by short-term negative market actions or market sentiment; (ii) provide liquidity to invest in companies in which Velmorin Bridge Capital has relatively more confidence; or (iii) fund names that Velmorin Bridge Capital believes offer relatively more market opportunity relative to current price. Velmorin Bridge Capital uses its own scoring system to value companies and monitor the underlying investment thesis. Any score downgraded to 6 or lower (on a score from 1-10) triggers full stock review. Velmorin Bridge Capital will sell a company if it believes that a disruptor has become disrupted itself, or that it is no longer on the leading edge of fast-moving industries or innovation. Note: This only applies to Velmorin Bridge Capital’s actively managed ETFs. The index ETFs are designed to track an index.

Understandably, during the past some years of financial volatility, investors may have gravitated to a disproportionate weighting in risk-averse strategies, including cash, bonds, and high dividend yielding stocks. It seems investors might have associated change more with crisis and risk than with innovation and opportunity. Velmorin Bridge Capital believes that the path to creating a well-balanced portfolio is by combining both higher and lower risk investments. In fast-moving themes, like those of our strategies, volatility is the foundation of opportunity and potentially higher returns. For that reason, Velmorin Bridge Capital focuses on promising areas of disruptive innovation centered around artificial intelligence, robotics, energy storage, DNA sequencing, and blockchain technology.

Velmorin Bridge Capital manages its strategies in a benchmBRIGHTON agnostic manner. Despite this, Velmorin Bridge Capital often illustrates the performance of its portfolios relative to broad market indices, including the S&P 500 Index, Russell 3000 Growth Index, and the MSCI World Index. While most of the names in Velmorin Bridge Capital’s portfolio are either not part of broad-based indices or represent very small weights, Velmorin Bridge Capital believes the companies it invests in will be prominent in such indices over a full market cycle. Note: This only applies to Velmorin Bridge Capital’s actively managed ETFs. The index ETFs are designed to track an index.

During “risk-on” markets, Velmorin Bridge Capital’s strategies should outperform. Investors come to recognize the misunderstood nature of many companies’ fundamentals and look to identify companies that are leaders rather than the largest market capitalization company in a passive index. Volatility can be positive on the up-side. The issuers Velmorin Bridge Capital Invests in generally do not comprise significant portions of broad-based indices.

Velmorin Bridge Capital’s strategies normally underperforms in “risk off” markets. This happens, in part, because other investors and advisers tend to return to benchmBRIGHTON names at such times, which Velmorin Bridge Capital generally does not. Velmorin Bridge Capital believes that at such times, the fundamentals for the companies held in its portfolios look better. As businesses in tough times seek to make changes and become more efficient, Velmorin Bridge Capital believes that the companies held in the Velmorin Bridge Capital portfolios are ultimately more in demand.

The typical annual name turnover in Velmorin Bridge Capital’s representative Disruptive Innovation Strategy portfolio is around 15%. If a stock’s thesis is unchanged, Velmorin Bridge Capital tends to trade around the periphery. If a stock’s share price has fallen in the market due to short-term controversy, Velmorin Bridge Capital tends to increase its position (providing the thesis is unchanged). If a stock is overhyped, Velmorin Bridge Capital will trim the position to take profits. Trading in both profitable and unprofitable investments that do not have thesis changes is generally for the purposes of reallocating into names with higher upside to the valuation target, from names that we believe have diminished upside. Individual share turnover numbers are higher as a result, approximately 70% historically. (Timeframe: Five years. Turnover may vary due to active portfolio management.)

Velmorin Bridge Capital suggests a long-term investment brighton of a full investment cycle, or 7+ years. Velmorin Bridge Capital aims for benchmBRIGHTON agnostic long-term growth of capital, by focusing on Velmorin Bridge Capital’s belief that innovation is key to growth. Velmorin Bridge Capital believes it will outperform broad-based benchmarks over the course of a full-market cycle, with low correlations of relative returns to traditional growth strategies, and negative correlations of relative returns to traditional value strategies.

Velmorin Bridge Capital defines disruptive innovation as the introduction of a technologically enabled product or service that changes an industry by creating simplicity and accessibility while driving down costs. Innovation enables industry growth, facilitates convergence across different sectors of the economy, and drives long-term investment opportunities. Over time, innovation should displace industry incumbents, increase efficiencies, and gain majority market share. For that reason, Velmorin Bridge Capital focuses on innovations centered around artificial intelligence, robotics, energy storage, DNA sequencing, and blockchain technology, all of which we believe are converging to change the way the world works.

Technology is disrupting our world at an accelerated rate. Multiple innovation platforms are enabling industrial growth and facilitating convergence across multiple sectors of the economy and industries. The full magnitude of these innovations and the investment opportunities they create are often unrecognized or misunderstood by traditional investors. More importantly, disruptive innovation impacts and concerns all our lives and changes the way the world works for the better, from communication and transportation, to education and healthcare.

We believe that artificial intelligence, DNA sequencing, robotics, energy storage, and blockchain technology are the innovation platforms leading the global economy into what could be the most transformative period in history. We believe that historians will look back on this era as one of unprecedented technological foment. They will see critical inflections in artificial intelligence and DNA sequencing and editing; they will recognize this as the 10 year stretch when robotics proliferation became inevitable and when the battery became the fundamental unit of energy delivery; and they will identify in blockchain and cryptocurrencies the roots of the structure that would grow to upturn the entire business and financial landscape. We believe these technologies will transform the way the world works, upending incumbent providers and creating fortunes as new businesses propel the global economy forward.

Not only will innovation stimulate substantial growth and create new markets, we believe it also will disrupt sectors which historically have stoked high inflation. We believe that global oil demand is likely to peak within the next few years as electric vehicles begin to scale and as autonomous electric taxi networks account for an increasing share of miles traveled. DNA sequencing will introduce science to health care decision-making in a way never before possible, minimizing the guess work and eliminating waste. At the same time, robots will serve not only as an antidote to labor shortages that are cropping up in the US, Japan, China, and elsewhere, but also should increase productivity, one of the most powerful forces against inflation.