In a recent episode of “Behind the Ticker,” Andrew Skatoff, founder of Bancreek, shared insights into his journey and the innovative investment strategies his firm employs. Skatoff, who graduated from Columbia Business School’s value investing program in 2009, began his career in the family office world, where he developed a deep understanding of long-term capital compounding. This experience led him to create a strategy focused on investing in structurally advantaged businesses, which he later spun out into Bancreek in 2021 to serve other family offices and investors.
About Andrew Skatoff and Bancreek
Skatoff explains that Bancreek’s investment approach is heavily data-driven, relying on a combination of fundamental and quantitative factors to identify businesses with long-term compounding potential. The firm employs a chief data scientist and utilizes sophisticated modeling and simulation techniques to analyze a vast array of data. This quantitative approach allows Bancreek to identify companies with unique competitive advantages, such as robust distribution pipelines, significant brand equity, and strong network effects, which can sustain growth and compounding over long periods.
Investment Strategy and Approach
Bancreek has launched two ETFs to bring their investment strategy to a broader audience: BCUS, which focuses on US large-cap companies, and BCIL, which targets international large-cap companies excluding the US. Both ETFs are constructed using a proprietary ranking system that identifies and weights approximately 30 top businesses based on their structural advantages. This methodology aims to provide investors with a diversified portfolio of high-quality, growth-oriented companies. The ETFs are refreshed monthly to ensure they reflect the latest data and insights from Bancreek’s quantitative models.
Skatoff also discusses the challenges and opportunities of entering the ETF market. He emphasizes that Bancreek’s unique value proposition lies in its ability to apply quantitative analysis to long-term investing, differentiating it from other short-term or momentum-driven strategies. To promote their ETFs, Bancreek focuses on education and transparency, offering data visualization tools and resources on their website to help investors understand their investment process. By engaging with advisors and attending industry conferences, Bancreek aims to build awareness and demonstrate the potential of their innovative approach to portfolio management.
Deeper Dive: Insights from the Full Conversation
Beyond the headline strategy, the full conversation between Brad and Andrew Skatoff covered several additional themes worth highlighting for advisors and investors.
On Process and Philosophy
I'm Brad Roth, chief investment officer of Thor Financial Technologies, and portfolio manager of THLV, the Thor Low Volatility ETF. Behind the Ticker, uncovers the inner workings of the ETF industry. We will interview portfolio managers and ETF service providers to dive deep into their work lives and their businesses. We will learn the inner workings of their strategies and what drives them as they continue to grow their company. Many of these individuals are entrepreneurs, and will have unique and compelling insights to share as much goes on behind the Ticker.
Well, it all started after graduating from business school. I went to Columbia Business School and went through the value investing program, and graduated in 2009 right after the financial crisis, as you can imagine, it was very interesting time to be looking out into the marketplace. And I was very fortunate because I ended up finding my way into the family office world and joined this wonderful New York-based family in 2009, and really learned the framework and mindset needed to compound capital over long periods of time, both our CIO and the family just had this wonderful framework on how to think of long-term and investing.
Market Context and Positioning
So if they want to start just learning a little bit more about vancrete in general, they can go to our advisor site vancrete.com. You can learn a little bit more about our history. You can play with some of the data visualization tools that I mentioned earlier. And if you want to learn more about our ETFs, you can go to vancrete.s.com and learn more about BCUS, BCIL. You can see the whole things that we have. And so you can read a little bit more about our process online.
Do you ever start to see kind of flows and trends inside of your screens as you're ranking companies that might tilt a little bit more towards value or sometimes could potentially tilt more towards growth or are you primarily just seeing value in the portfolio? Can you talk about that at all?
So, I mean, we're constantly working on the engine. So, that's, that's kind of what we spend decent amount of our time. So, we're constantly testing, trying to find new features, things that did improve the portfolio's performance, but the cadence of the ETF right now is for every fresh, every month, even though we're constantly working on it in the background.
Notable Insights
"So, I would say what we found to yield the best results is to kind of let the tool do what it does and kind of, you know, follow the allocation recommendations that it has."
"And really, there's not a ton of products out there in the ETF marketplace to address, you know, these, these wonderful businesses and get investors, the opportunity to invest them."
Key Takeaways
- Bancreek has launched two ETFs to bring their investment strategy to a broader audience: BCUS, which focuses on US large-cap companies, and BCIL, which targets international large-cap companies excluding the US.
- This methodology aims to provide investors with a diversified portfolio of high-quality, growth-oriented companies.
- He emphasizes that Bancreek’s unique value proposition lies in its ability to apply quantitative analysis to long-term investing, differentiating it from other short-term or momentum-driven strategies.
- To promote their ETFs, Bancreek focuses on education and transparency, offering data visualization tools and resources on their website to help investors understand their investment process.
- By engaging with advisors and attending industry conferences, Bancreek aims to build awareness and demonstrate the potential of their innovative approach to portfolio management.
What This Means for Advisors
For financial advisors evaluating options for client portfolios, this conversation with Andrew Skatoff highlights important considerations around fixed income. Understanding the strategy behind each fund—not just the ticker—helps advisors make more informed allocation decisions and better communicate the rationale to clients.
The themes of fixed income and quantitative investing discussed in this episode are particularly relevant in the current market environment, where advisors are increasingly looking for differentiated solutions that go beyond traditional benchmarks.
Listen to the Full Episode
This article is based on an episode of Behind the Ticker, hosted by Brad Roth, Founder and CIO of THOR Financial Technologies. For the full conversation with Andrew Skatoff, including additional nuances and details, listen on Spotify, Apple Podcasts, or watch on YouTube.