American Capital Management is dedicated to helping our clients achieve their goals through investing in a disciplined growth strategy.
Learn MoreAmerican Capital Management, Inc. (ACM) is a boutique investment management firm, founded in 1980, with over $3.5 billion in assets under management as of March 31, 2022. We believe our firm and investment approach are unique relative to most investment management organizations. We invest for growth, focusing on active management of innovative quality small and medium-sized companies — the most rapidly growing sector of the economy. The firm is a registered investment advisor with the SEC.
Subject Matter Experts in growth investing.
We invest in businesses with an understanding that market fluctuations are a normal part of asset management.
Management can influence revenues whereas market cap is a product of market opinion. This aligns with ACM’s long-term perspective.
Dedicating time and attention where it is most valuable.
An investment process that yields results.
Carefully researched, strong businesses are their own best tools to manage risk within a portfolio.
We consider ourselves owners of businesses and make decisions with a long-term investment horizon.
Focusing on innovative small and medium-sized growth companies enables us to hold our positions for an extended period of time. This has resulted in higher returns, lower turnover, and greater tax efficiency for taxable investors.
The strategy emphasizes revenue instead of market capitalization to evaluate size.
All members of the investment team are generalists, as we believe this produces the best framework for informed opinions and productive dialogue.
The Wall Street maxim that summarizes the past year is “Don’t Fight the Fed.” Returns on stocks and bonds were negative because of the historic pace of Fed tightening marking the first time both asset classes experienced a bear market simultaneously. Furthermore, stock prices had the sharpest decline since 2008 while bond investors recorded the worst year in over a century. In 2022, the 20-year Treasury bond index fund declined 31% – worse than most stock indices. In 2023, the stock market began positively with the S&P 500 (SPX) and Nasdaq Composite rising 6.2% and 10.7% respectively. The Nasdaq gain was its best January since 2001.
The Federal Reserve raised short-term interest rates seven times in 2022 for a cumulative increase of 425 basis points (bps). The 10-year Treasury yield rose from 1.51% to 4.32% in October before declining to 3.52% today. In addition, the Fed started to shrink its balance sheet of bonds as a restrictive measure. The sudden tightening of financial conditions compressed the S&P 500 earnings multiple from 21.1x to 17.5x, and was the biggest detriment to stock returns in 2022 as earnings growth met expectations. Today, the outlook is complex and includes an economic slowdown, an uncertain earnings outlook, decelerating inflation and higher interest rates. There is a balancing act between favorable factors and negative headwinds. It is important to remain disciplined and patient with the likelihood of an improving environment in 2024. The market tends to look over the valley to the hills. A summary of index returns for the year ending December 31, 2022 is as follows:
Dow Jones Industrials -6.9% Russell 2500 -18.4%
MSCI EAFE -14.0% S&P 500 -18.1%
NASDAQ Composite -32.5% Wilshire 5000 -19.0%
American Capital Management, Inc.
575 Lexington Avenue
30th Floor
New York, NY 10022
TEL: 212-344-3300
FAX: 212-658-9693
info@amcapmgt.com