MontLake Cooper Creek Partners North America Long Short Equity

Cooper Creek was founded in 2008 by Rob Schwartz and employs a catalyst-driven, value-oriented approach to investing in under-the-radar North America small and mid-cap companies ($750m to $4bn market cap) with the potential for transformational change. There is a significant focus on generating alpha from both sides of the book, with the PM running a 70-90 stock portfolio (evenly split between longs and shorts) at any one time. On the long side the PM often focuses on turnaround stories (spin-offs, restructuring, etc with little sell side coverage) which are identified via in-depth, fundamental, bottom-up analysis whilst seeks to avoid ‘crowded’ situations as well as deep-value investments that depend on valuation without a clearly defined catalyst to unlock value. On the short side, the team focuses on six well-defined categories: accounting shenanigans, M&A roll-ups, unsustainable dividend yields, debt covenant/maturity issues, one-hit wonders, peak margin stories. The investment horizon is shorter for these positions (3-6 months vs. 9-18 months for long ideas). The final portfolio is relatively concentrated, with the top 3-5 long positions typically sized at 3.5-5%, and is run with a conservative net exposure (0-30%, approx. 10% on average since inception) and gross exposure (max 200%), with the long book typically managed in an unlevered fashion.