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Gotham Asset Management LLC

Last Updated: 12/3/2020

Gotham Asset Management LLC is a Limited Liability Company that started in 2008 and is primarily owned and controlled by Joel Greenblatt and Robert Goldstein.

Greenblatt's original advisory business, Gotham Capital, was started in 1985 under the same value-oriented philosophy. He is perhaps better known outside of the hedge fund world as the author of the New York Times Bestselling Book The Little Book That (Still) Beats the Market, in which he outlined a "Magic Formula" of investing that was largely a two factor model ranking companies with high earnings yield and return on capital.

Per its brochure, Gotham acts as the investment manager to private funds, mutual funds, and separately managed accounts that generally invest in publicaly traded equity securities and equity-related securities. Gotham believes that while individual stocks gravitate toward fair value over longer periods of time, and that they frequently trade at significant deviations from fair value. Gotham generally take long positions in securities that we believe to be undervalued and short positions in securities that we believe to be overvalued, subject to each portfolio's risk constraints.

Gotham Asset Management LLC operates out of an office in New York, NY. Based on the Form ADV filed on 2020-03-20 00:00:00, the investment firm is comprised of 42 employees, only 22 of whom performs investment advisory functions.

Fact Sheet

      Name: Gotham Asset Management LLC
      CRD No: 149335
      Filing Recorded: 2020-03-20 00:00:00
      Year of Origin: 2008
      Employees: 42
      Clients: 68
      AUM: 7,894,246,932
      Management Fee: 1 to 2 Percent
      Performance Fee: 10 to 30 Percent
      Client Type: Pooled Investment Vehicles, Investment Companies
      Assets Traded: Exchange-Traded Equity Securities, Cash and Cash Equivalents


Investment Strategy

According to the brochure submitted to IAPD, Gothams investment strategy is as follows:

The Co-CIOs believe that while individual stocks gravitate toward fair value over longer periods of time, they frequently trade at significant deviations from fair value, for various reasons such as emotion, analytical errors, and the inability of many large institutional investors to tolerate short-term underperformance. Further, as markets have become more institutionalized, investor time horizons seem to have shortened. We believe that capital allocations follow recent performance (both good and bad) and therefore portfolio managers "need" to do well now. We believe this institutionalized effect has been growing over the last several decades. This causes certain companies to be systematically avoided even if they are attractively priced, generate substantial free cash flows and earn high returns on capital. We seek to capitalize on these market inefficiencies by employing a systematic bottom-up approach to identify companies that appear to be undervalued or overvalued on both an absolute and relative basis.

In order to take advantage of these inefficiencies, the Co-CIOs, together with the analyst team, evaluate companies according to the Firm's analytical framework. Long portfolios are generally constructed from the most undervalued stocks, while short portfolios are generally composed of the most overvalued stocks based on the Firm's assessment of value, subject to pre-specified risk and diversification constraints.

Methods of Analysis

In addition, Gothams methods of analysis include:

In valuing securities traded in the United States, our research process consists of:

• Researching and analyzing each company in its coverage universe according to a methodology that emphasizes fundamentals such as recurring earnings cash flows, capital efficiency, capital structure and valuation;

• Identifying and excluding companies that do not conform to the Firm's valuation methodology or companies judged by the Firm to have questionable financial reporting;

• Updating the analysis for earning releases, annual (Form 10-K) and quarterly (Form 10-Q) reports and other corporate filings; and

• Recording the analysis in a centralized database enabling the Firm to compare companies and identify longs and shorts based on our assessment of value.

Top 10 Holdings from Form 13F

Reporting Period: 09/30/2020

Issuer Share Value(1000s) Put/Call
APPLE INC 625,518 72,441
AMAZON COM INC 19,013 59,867
MICROSOFT CORP 283,698 59,670
ALPHABET INC 28,625 41,953
FACEBOOK INC 154,147 40,371
ORACLE CORP 484,398 28,919
WALMART INC 188,400 26,359
JOHNSON & JOHNSON 158,880 23,654
EBAY INC. 408,393 21,277

Historical 13F Filings

EdgeGiant has compiled all 13F filings since Q2 2013 for your convenience. You can view historical portfolio position forGotham Asset Management LLCin our 13F section HERE.

To get the comprehensive list of holdings that fall under 13F regulatory guidelines, check out our write up on how to access and use 13Fs in your personal investment decisions.

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Historical Portfolio Holdings for Gotham Asset Management LLC