PILLAR I · FIRST GATE
Opportunity Screening
The first of ABCD Fund's three investment pillars: the filter that keeps uninvestable situations out of the research queue before analysis begins.
Screening does not decide what to buy. It decides what is worth the cost of finding out — and what should stop here instead.
- First of Three Pillars
- Signals, Not Decisions
- Advance · Watchlist · Reject
Why This Gate Exists
Where Temporary Mispricing Becomes an Investable Candidate
Most market stress is noise. Opportunity Screening exists to identify the exceptions: situations where price has moved but the business has not, where forced selling, misread fundamentals, or neglect have created a temporary discount that discipline, not speed, converts into return.
This stage does not make investment decisions. It qualifies candidates for deeper research, or removes them before capital or research time is committed. Every position that enters the portfolio has passed through this gate first.
Where Candidates Come From
Candidate Sources & Signals
Candidates are not discovered the moment stress appears. A universe of names meeting baseline sector and business-quality standards is monitored on an ongoing basis, and reviewed on a regular cadence. A screening event begins when one of the signals below appears against a name already known to that watchlist — not when a headline does.
The Evidence Bar
What Must Be True Before a Candidate Advances
A signal alone does not qualify a candidate. Before a name can leave Opportunity Screening, each of the following must be evidenced, not assumed:
What Happens Next
Three Outcomes, Not Two
Every screened candidate resolves to one of three outcomes. Screening does not force an advance-or-reject decision before the evidence supports one.
Advance
To Deep Discovery Research
Every qualifying factor is evidenced: the dislocation is measurable, the business is recoverable, a catalyst and a bounded downside are documented, and no legal, structural, or data concern blocks a clean entry.
Watchlist
Held for Continued Monitoring
One or more factors is unresolved: a catalyst not yet confirmed, data still incomplete, or a structural question under review. The name remains on the watchlist rather than advancing or being rejected.
Reject
Screened Out
The impairment looks structural rather than temporary, no credible catalyst exists, or a legal or structural concern disqualifies the candidate outright. It is removed before research capacity is spent.
Applied Across Two Mandates
How Screening Applies to Eclipse and Nova
Both of ABCD Fund's intended launch strategies use this same gate. What differs is the role it plays inside each mandate.
Crisis Upside · Concentrated
Eclipse Fund
Opportunity Screening is Eclipse's primary entry filter. Every equity position begins here: a crisis-driven dislocation across global listed equities, screened before Deep Discovery Research is committed to the name.
Absolute Return · Diversified
Nova Fund
Nova generates candidates across four strategy sleeves. Screening governs entries into its equity sleeve, applying the same qualifying factors before a name is passed to Deep Discovery Research.
Moving to Deep Discovery Research
Candidates that advance move to Pillar II: Deep Discovery Research, where the business model is tested against the stress scenario that created the entry price.
← Investment FrameworkNext Investment Pillar
II · Deep Discovery Research →
Common Questions
Opportunity Screening in Practice
Does ABCD monitor candidates actively, or respond to market events as they emerge?
Candidates are researched before markets price in distress, not discovered after. A watchlist of names meeting the broad sector and business-quality criteria is maintained on an ongoing basis. A screening event is triggered when an identified name reaches a qualifying signal; it is not the first time ABCD encounters the company.
What disqualifies a candidate at screening, even if it appears cheap?
Four conditions lead to disqualification regardless of apparent valuation discount: structural, not temporary, impairment; insufficient reliable data to test the thesis; absence of a credible catalyst within a definable horizon; and an unresolved legal or structural concern. Valuation discount alone does not qualify a candidate.
What happens to a candidate that is neither advanced nor rejected?
It remains on the watchlist. Some names satisfy most, but not all, qualifying factors: the catalyst may still be forming, or supporting data may still be incomplete. Rather than forcing an advance-or-reject call early, the name is held for continued monitoring and revisited as new information arrives.
How many candidates pass from Opportunity Screening to Deep Discovery Research?
Most screened candidates do not progress. The stage is intentionally broad at entry and highly selective at exit. Only names where every qualifying factor is confirmed advance to Pillar II. The pass rate is low by design; it is what makes the research queue investable.
How does Opportunity Screening differ from typical value investing?
The primary distinction is the catalyst requirement. Traditional value investing may accept cheap businesses without a defined recovery mechanism, relying on market re-rating over time. Opportunity Screening requires a specific, identifiable path to recovery: a computable margin of safety and a documented reason the mispricing will close.
Investor Relations
See How Screening Drives Position Selection
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