Gates Capital Management’s ECF value fund has earned strong returns for investors since its inception in June 1996. The ECF, or Excess Cash Flow Fund, had returned 12.9% annualized since inception to the end of September 2020. That was compared to 8.9% for the S&P 500 total return index and 7.4% for the HFRI Event-Driven Index.
Q3 2020 hedge fund letters, conferences and more
The firm’s marketing materials noted that every $1 million invested with it at inception was worth $19 million at the end of September. A similar investment in the S&P 500 would be worth just $8 million.
Seeking Value In Free Cash Flow
According to an investor presentation, ValueWalk has been able to review, Gates attributed its strong long-term performance to a consistent, systematic, event-driven investment approach.
The marketing materials reported that the strongest performer in the firm’s portfolio during 2020 was HVAC business Carrier. This position contributed 4.2% of overall performance.
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