Why we make specific changes to our portfolios falls into two categories.
- Environmental, economic, and macro reasons.
- Individual security specific reasons.
The environmental, economic, and macro reasons we made changes over the last part of 2025 into 2026, and we intend to maintain flowing into 2027, are detailed in our newsletter Investment Strategy into the New Year. This is part of the puzzle and part of our job, keeping our eyes on the data and both trailing and emerging trends, and making small changes to your portfolio accordingly.
The other category is individual and security specific. As the environment and data change, so will our minds. But these are some of the changes we have made over the last 12 months and why.
Many of the small changes you see in your portfolio are just that: small. They are reinvesting dividends, creating cash for distributions to you, and/or rebalancing. Things of that nature. But some are larger and much more purposeful.
For example:
About 8 years ago we invested in the Griffin Diversified Real Estate Fund (GRIFX) run by portfolio manager Dr. Randy Anderson. We met with Randy, visited the Griffin office, and scrutinized their process, culture, and internal operations. We liked what we saw and invested in the fund, which remained a core holding for many years.
Then in about 2022 Griffin was bought by Apollo. Scott and I took a flight down to Florida to meet with Apollo and learn about their company, how they planned to manage the portfolio, and see what changes were being made. We came back comfortable with the acquisition and stayed invested.
Dr. Randy Anderson then left Apollo in 2024, and we have since been slowly divesting ourselves of that position. As it stands today, we have about $1.2 million still in GRIFX and are selling pieces of it each quarter. We should be fully divested by early 2027.
Why? Because there is just too much change and originally, we were really buying into Randy and his knowledge and expertise regarding real estate investing. His departure ultimately became the deciding factor.
It isn’t a sexy answer, but it was a well-thought-out decision based on our evaluation of the fund and the manager transition. In our opinion, the fund has had challenges in redemption operations and performance since Dr. Anderson’s departure, which reinforced our decision to continue reducing the position.
Another example:
One of our longest holdings at TenBridge was in the Jensen Quality Growth Fund (JENSX). The Jensen office is in our backyard in Lake Oswego. The president of the firm would come to our office a couple of times per year to provide updates on their recent meetings with companies they were invested in. They had strict criteria for the investments they made. Companies had to show consistent Return on Equity (ROE) over a 10-year period of at least 15% per year. This narrowed their investment universe, so they typically had between 25-30 holdings in the portfolio.
This methodology performed well until the AI boom and cloud storage hit, and 7 companies accounted for a large share of the return in the S&P 500 over a couple year stretch, this fund underperformed. Why? These companies were tech highflyers. They didn’t all have a long-term track record of consistent growth and strong ROE, so they were not included in the JENSX portfolio. We still felt Jensen was a good long-term hold based on their philosophy.
Then at the height of this Mag 7 run, Jensen decided to invest in these companies. We did not agree with that shift after these companies had already shot up and were potentially overvalued. Those Mag 7 stocks feel like a bubble to us, and it seems more prudent to stage away from them rather than buying in.
We had been reviewing possible alternatives to this fund and had the DFA US High Relative Profitability Portfolio (DURPX) reviewed and ready to go. It still focuses on quality but has broader diversification. It starts with the largest 90% of companies in terms of market capitalization. Then it focuses on the top 35% of those companies measured by profitability. Companies with higher profits, smaller market caps and companies with lower relative prices (measured by price/book) are overweight. We swapped Jensen for DFA toward the end of 2025.
So far in 2026, the relative performance of these investments has favored the DFA fund. The DFA fund returned 11.54% as of 8/31, while the Jensen fund returned 4.94% over the same time period.
Last example:
We also removed our mid cap Eaton Vance Atlanta Capital SMID Cap (EAASX) fund and added that money to our Davenport Small Cap Focus fund (DSCPX). Over a couple of years, the allocation of these funds has drifted closer together. They were very similar to each other in their style, and we didn’t need two funds to do basically the same thing.
In our review, the Eaton Vance portfolio was not performing in a manner consistent with our expectations. To be fair, the Davenport fund had some underperformance as well. But most of this is macro market related over the past couple of years that has been punctuated by companies that are not as profitable and have a tendency to burn out quickly.
Davenport focuses on small cap companies that are profitable (notice a theme here?). They have underperformed during certain market environments but have historically performed better during some more normalized market periods.
We didn’t have clairvoyance on these changes, we simply saw changes we didn’t like to management, to portfolio composition, or to style drift. We took a deep dive and made changes based on our assessment of the available information, and so far those decisions have aligned with our expectations.
There have been times at TenBridge where we made changes and they didn’t work so well. We can admit that. But the reasoning behind the changes were solid and well thought out. You just can’t predict how those changes will work out. But we believe a disciplined, quality-focused approach remains appropriate for long-term investors.
Important Disclosures: This commentary reflects TenBridge’s views as of the date written and is subject to change. References to specific securities, funds, indexes, or investment strategies are for illustrative purposes only and are not recommendations to buy or sell any security. Investing involves risk, including possible loss of principal. Diversification and asset allocation do not ensure a profit or protect against loss. Past performance does not guarantee future results. Indexes are unmanaged and cannot be invested in directly.
About TenBridge Partners
TenBridge Partners is an independent financial planning and investment management firm based in Portland, Oregon with a simple focus of honoring the fiduciary responsibility of putting clients first. Guiding with curiosity and trusted expertise, we empower people to live their unique story with financial clarity and confidence.
Planning is central to everything we do. Our focus is on a complete understanding of your needs through the financial planning process, putting your success at the heart of our work.
We strive to create a community where financial planning feels fun, dynamic, and human.
From the desk of
Erik Lawrence CFP®
The information contained in this correspondence is intended for general educational purposes only and as a means for facilitating a conversation. Please consider our door always open to discuss your particular situation and how this information might benefit you and fit your specific needs.