Our Process

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Our Investment Process

Our Platform

Our investment process and philosophy are based on years of investment experience that integrates top-down and bottom-up, fundamental research. Little House Capital combines comprehensive data analytics capabilities and innovative trading solutions to provide our clients access to an institutional based, risk-adjusted, investment experience.

Our Principles

We recognize the importance of creating investment strategies and products tailored to each client’s specific risk tolerance and longer-term performance requirements. Staying the course is often difficult but with decades of market experience, Little House is confident that our investment process and objective driven solutions will provide our clients their desired long-term outcomes.

Our Philosophies

  • Diversification is key
  • Markets evolve and require a nimble, actively managed approach to portfolio construction
  • Irrational market behavior creates opportunities for disciplined, fundamentally oriented investors
  • Deliver favorable risk-adjusted returns
  • In the short-term, share prices are heavily influenced by changing investor sentiment
  • In the long-term, share prices reflect the value of cash flows and economic profits

Diversified Asset Allocation

Little House Capital recognizes the importance of a well-diversified, risk-adjusted, asset allocation. Our strategies focus on macro assessment of the global landscape while incorporating selective exposure to various asset types. Our Investment Team evaluates many factors that may include the geopolitical landscape, fiscal and monetary policies, macroeconomics factors, market conditions, industry/sector fundamentals, and overall valuations to build our many asset allocation strategies. Little House underscores the importance of tactical thinking based on systematic and non-systematic circumstances impacting our current and future overall market assumptions.

Highlights include:

Macroeconomic

  • Global Growth Profile
  • Monetary & Fiscal Policy
  • Inflationary Expectations
  • Foreign Trade

Capital Markets

  • Asset Class Risk Review
  • Return Expectations
  • Factor/Style Trends
  • Yield Curve Assessment

Industry Themes

  • Innovation/Disruption
  • Consolidation/Concentration
  • Relative Industry Profitability
  • Growth and Valuation trends
  • ESG Profile

Risk Environment

  • Macro Factor Profile
  • Investor Risk Aversion
  • Systemic Economic Risk
  • Correlation Analysis

Stock Selection

Little House’s proprietary products adhere to specific investment criteria and disciplines underscoring the composition of products’ stated objectives. Our products, many used by other advisors, emphasize the importance of sector allocation with our value, core, and growth mandates. Stated otherwise, no sector as in the case with growth (technology) and value (financials) should ever represent more than 30%-40% of the overall portfolio. Our approach focuses on lowering overall allocation risk while emphasizing the importance of stock selection to achieve favorable performance results in our various strategies and products.

Little House’s US Large Cap screening process consists of the S&P 500, Russell 1000 Growth, and/or Russell 1000 Value depending on the products’ stated objectives (i.e., Little House’s Value, Core, and Growth offerings). Eligible companies must adhere to a set of fundamental criteria validated by our proprietary screening process. Typically, 100 – 125 potential target companies are further analyzed on fundamental factors prior to inclusion in the portfolio.

Weekly, we review and discuss our holdings ascertaining market conditions and predetermined price targets. Normally these discussions are centered upon our core beliefs surrounding intrinsic valuations of entities based upon our underlying fundamental assumptions and future cash flows.

Highlights include:

Business Model

  • Revenue Sourcing
  • Profitability/Cash Flow
  • Growth Drivers
  • Cost of Capital
  • Financial Predictability
  • Intrinsic Value Range

Growth Prospects

  • Growing Industry Trends
  • Market Share
  • Product Innovation
  • Margin Expansion
  • Cash Flow Growth Potential

Financial Flexibility

  • Solid Balance Sheet
  • Free Cash Flow Generation
  • Manageable Cost of Capital
  • Adequate Dividend Coverage
  • Cost Containment
  • Debt Quality/Management

Management Quality

  • Record of Value Creation
  • Shareholder Oriented
  • Corporate Vision
  • Regulatory Backdrop
  • Proven Track Record

Portfolio construction considers overall positioning of sectors and overall tracking error across our holdings. Routinely, the investment team determines the overall risk profile and makes recommendations on current positioning and what new purchases and sales are warranted.

Overview

Outside Fund Selection

Little House Capital uses outside money managers to complement our many diversified strategies. We believe in using a diversified approach to target higher risk-adjusted returns.

Little House’s Preferred Product Investment Offering (PPIO) is based on a proprietary scoring process to determine what mutual funds (MF) and/or exchange traded funds (ETF) are eligible for inclusion in our strategies. Each outside product is scored on a scale of 0-10; factors often considered include performance, consistency, expense, risk, and volatility. Little House places a premium on risk-adjusted and longer-term low volatility returns.

Routinely, the investment team talks directly with each specific outside product’s portfolio team to consider current positioning. Rarely does Little House place a product into our strategies without establishing a formal relationship with the underlying investment management team.

Each product’s performance results are actively monitored by Little House to ensure investment objectives and risk factors are maintained. Our investment team maintains a preferred products list (PPIO) to monitor which products coincide with our market outlook and best thinking to maximize returns for our investors.

Risk Management

A critical element of portfolio construction requires understanding many risk factors that may include allocation and selection tracking error effects, Alpha, and portfolio stress testing under certain market conditions. We integrate this data with portfolio construction tools to determine the impact of hypothetical trading actions or specific back testing to ensure optimal, risk-adjusted returns.

Other Highlights

  • Identify the sectors or holdings that have contributed to your portfolio’s performance and compare it relative to your benchmark.
  • For equity portfolios, break down your active return in terms of sector allocation, security selection, and currency movements.
  • For fixed income portfolios, further attribute your active performance to changes in interest rates and spread effect.

Learn More About Our Specific Strategies and Products

Learn More

Learn more about what Little House can do for you

Let’s Connect

Little House Capital, LLC

  • 35 Braintree Hill Park
    Suite #100
    Braintree, MA 02184

  • 71 Elm Street
    Worcester, MA 01609

  • 15 Constitution Drive
    Suite 1A
    Bedford, NH 03110

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Little House Capital, LLC was awarded America’s Top Financial Advisory Firms: 2025 on November 19, 2024, for the year 2025. America’s Top Financial Advisory Firms: 2025 was created by Plant-A Insights and Newsweek and is awarded based on a variety of factors that are linked here. Little House Capital, LLC has only provided compensation directly to Plant-A Insights and Newsweek for the licenses of the award and did not provide compensation to be given this award.

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