Investment Philosophy

Managing downside risk has proven to be one of the key drivers to quality returns over time, which is why it is at the heart of Meridian Funds’ investment philosophy. ArrowMark Colorado Holdings LLC ("ArrowMark"), the Funds’ investment adviser, believes that avoiding companies with significant underperformance is a more critical component to portfolio success than looking to select just the best performers. This approach, that seeks to limit loss as the market falls and provide upside capture as the market rises, is the hallmark of Meridian's Investment Philosophy.

Consider the following scenario. A hypothetical portfolio experiences a 10% loss of value during a market downturn. That portfolio will need to return 11% to return the portfolio back to it's starting value. Take this example out even further, to a 20% or 50% loss and you begin to see how much you need to recover just to breakeven. By limiting the downside through managing risk, investors may achieve greater performance over a long-term investment horizon and just as importantly, have more confidence and conviction to stay invested for the time needed.