Download - Parnassus Investments Firm Brochure
FPO
Where Principles and Performance® Converge
$5 billion AUM2011
Parnassus is a fundamental, bottom-up investment firm that was founded in 1984
based on the belief that a well-managed responsible investment strategy could
outperform traditional approaches.
To build wealth responsibly for our clients, our investment team selects businesses
that they believe have increasingly relevant products or services, sustainable
competitive advantages and quality management teams for the firm’s high-conviction
portfolios. Every investment must meet rigorous fundamental and environmental,
social and governance (ESG) criteria.
Who We Are
Parnassus Investments founded by Jerome L. Dodson Parnassus Fund launched
1984Core Equity Fund launched Fixed Income Fund launched
1992Todd C. Ahlsten named Portfolio Manager of the Core Equity Fund
2001
$1 billion AUM2003
Endeavor Fund launched Mid Cap Fund launched
2005 2008Todd C. Ahlsten named Chief Investment Officer
Matthew D. Gershuny and Lori A. Keith named Portfolio Managers of the Mid Cap Fund
Our History
Ian Sexsmith named Portfolio Manager of the Parnassus Fund
Samantha D. Palm named Portfolio Manager of the Fixed Income Fund
$10 billion AUM
2013
Benjamin E. Allen named Portfolio Manager of the Core Equity Fund
2012Robert J. Klaber named Portfolio Manager of the Parnassus Fund
$20 billion AUM2016
$25 billion AUM2017
Matthew D. Gershuny appointed Director of Research
2014
Benjamin E. Allen named CEO
Billy J. Hwan named Portfolio Manager of the Endeavor Fund
Iyassu T. Essayas named Director of ESG Research
2018Parnassus Fund shifts to mid cap growth strategy and is renamed Parnassus Mid Cap Growth Fund
Minh T. Bui named Portfolio Manager of the Parnassus Fixed Income Fund
2020
“I started Parnassus Investments in the basement of my
house in 1984 to build wealth responsibly for investors,
and it has grown far more than I ever expected.”
– Parnassus Founder and Chairman Jerome Dodson
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Our Values
Principled
We hold ourselves to high ethical
standards and our actions are
guided by integrity and respect.
These principles foster a culture
of trust and guide our responsible
investment approach.
Always Learning
We work to continuously improve
our skills, processes and delivery.
We seek productive feedback from
teammates, investors and business
partners. By doing so, we operate
efficiently and create more value
for our investors.
Shared Success
We succeed when we help
our investors achieve their
long-term goals.
Collaborative
We value teamwork over
individual achievement and
empower our employees.
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Our Investors Our products appeal to investors who seek long-term core strategies that anchor their
portfolios. All of our shareholders value a well-known, high-quality boutique manager
that takes a clearly defined active approach to investing. Many appreciate the additional
information that ESG analysis provides to fundamental stock picking, while some are
primarily interested in either fundamental company analysis or social outcomes.
We make our products as widely available as possible. Some investors work directly
with us, through our website or their self-managed brokerage accounts. Other
investors work with their financial advisors to access the Parnassus strategies. We also
serve institutional investors and consultants by offering both institutional mutual funds
and separately managed accounts.
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Parnassus Investments believes that high-quality companies with solid fundamentals
offer compelling long-term investment opportunities. Our investment team defines
high-quality companies as businesses that have increasingly relevant products
or services, sustainable competitive advantages, quality management teams and
positive ESG profiles. We believe that incorporating ESG research into the decision-
making process improves both investment and social outcomes. In our view,
accurately determining an attractive purchase price is dependent on a thorough
assessment of quality.
Our Investment Philosophy
“Parnassus is a research-driven firm with a deeply
collaborative culture. When we invest, we invest big
and hold companies for a long time. Every potential
holding is scrutinized by the full team, which has
decades of experience working together to implement
the firm’s high-conviction investment process.”
– CEO Benjamin Allen
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Our Approach Principles and Performance®
Fundamental and ESG viewpoints
Our investment professionals fully integrate fundamental financial and ESG research to
assess business quality.
Collaborative research
Our entire research team closely collaborates to develop a thorough understanding of
each company’s potential range of outcomes.
High conviction We develop a high level of confidence before we buy, because we invest with
conviction for the long term.
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Our Investment Process
Moat Companies with wide moats have
sustainable operations, and can
defend their businesses against
competitors and ward off the threat
of new entrants to the industry.
ESG Companies with positive ESG
profiles have good governance,
environmental practices, workplaces
and relationships with their
communities and customers.
Valuation Once a potential investment has been identified, the team determines a
probability-weighted range of valuation outcomes. This guides the portfolio
managers’ decision about when to buy.
Management Properly incentivized management
teams with long-term focus who
own meaningful amounts of the
company stock are likely to focus
on the long-term health of the
company.
Relevancy Companies with increasing
relevancy offer products or services
that are gaining share in the overall
economy and maintain workplaces
that have high levels of retention
and engagement.
We invest in companies with positive moats, management, relevancy and ESG profiles.
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“Whereas much of Wall Street just looks at the tip of the
iceberg, we look below the water line to deeply understand
each company’s products, management team and history
and determine what makes them special.”
– CIO Todd Ahlsten
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ESG IntegrationOur team’s comprehensive ESG analysis uncovers hidden risks and opportunities that
may be overlooked by other investors.
We believe every investor can gain an advantage with investments that are selected
after considering the company’s environmental record, researching the state of its social
relationships and monitoring the health of its governance. Using all these ESG lenses as
part of a comprehensive security selection process that also includes thorough analysis
of traditional financials can result in a more complete understanding of each potential
holding. And this approach can benefit all investors—whether their starting point is ESG
principles or financial performance.
Exclusionary ScreensThe ESG team’s analysis begins by excluding companies from consideration if
they derive significant revenue from alcohol, tobacco, weapons, gambling, nuclear
power or fossil fuels.
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Environment Energy and water usage
Product life cycle
Carbon footprint
Waste stream
Governance
Leadership structures
Compensation
Management turnover
Business ethics
Community Relations with stakeholders
Impact on the community
Philanthropy
Customers
Product safety
Recalls
Privacy
Workplace Diversity and inclusion
Employee benefits
Safety
Engagement
ESG FactorsThe ESG analysts undertake comprehensive research on those companies that pass the
exclusionary screens, focusing on multiple issues that are grouped into five broad factors.
The key indicators within each category are disclosure, policies, performance
and industry-specific factors.
Company EngagementParnassus owns large quantities of company stock, which opens up opportunities for
our investors to make their voices heard by some of the most powerful companies in
the world. In our experience, building positive relationships with management—which is
more likely to happen when they know we are significant stockholders—is an impactful
way to effect meaningful corporate change. When companies see we are offering
constructive suggestions, they may also approach us for advice.
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The five Parnassus Funds® are actively managed mutual funds. The funds employ a
singular investment process that fully integrates fundamental and ESG analysis to
identify high-quality companies with attractive valuations. With options that aim to
smooth your client experience across market cycles or provide a higher risk/return
profile, all the Parnassus Funds feature extensive track records and oversight by
seasoned portfolio managers.
Our Funds
Todd C. Ahlsten, Chief Investment Officer and Lead Portfolio Manager (since 2001)
Benjamin E. Allen, Chief Executive Officer
Parnassus Core Equity Fund Holds high-quality companies as it seeks both lower downside capture during market declines and a large portion of market gains.
Tickers Asset Class Benchmark Holdings Inception
PRBLX / PRILX U.S. large cap S&P 500 Index ~40 8/31/1992
Jerome L. Dodson, Lead Portfolio Manager (since 2005)
Billy J. Hwan, CFA, CPA, Portfolio Manager (since 2018)
Parnassus Endeavor Fund A positive workplace fund that holds deeply discounted out-of-favor stocks that the team believes are likely to bounce back.
Tickers Asset Class Benchmark Holdings Inception
PARWX / PFPWX U.S. large cap S&P 500 Index ~30 4/29/2005
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Ian Sexsmith, CFA, Portfolio Manager (since 2013)
Robert J. Klaber, Portfolio Manager (since 2016)
Parnassus Mid Cap Growth Fund The Parnassus Mid Cap Growth Fund invests in U.S. mid cap growth companies. The portfolio managers focus on high-quality, relevant businesses that they believe have ample runways for continued growth.
Tickers Asset Class Benchmark Holdings Inception
PARNX / PFPRX U.S. mid cap growth
Russell Midcap
Growth Index~40 8/31/1992
Matthew D. Gershuny, Lead Portfolio Manager (since 2008)
Lori A. Keith, Portfolio Manager (since 2008)
Parnassus Mid Cap Fund Holds high-quality companies as it seeks both lower downside capture during market declines and a large portion of market gains.
Tickers Asset Class Benchmark Holdings Inception
PARMX / PFPMX U.S. mid capRussell Midcap
Index~40 4/29/2005
Samantha D. Palm, Lead Portfolio Manager (since 2013)
Minh T. Bui, Portfolio Manager (since 2020)
Parnassus Fixed Income Fund A U.S. intermediate investment grade fund that leverages the Parnassus team’s expertise in fundamental and ESG research to select individual debt securities.
Tickers Asset Class Benchmark Holdings Inception
PRFIX / PFPLXU.S. investment grade fixed income
Bloomberg Barclays U.S. Aggregate Bond Index
~95 8/31/1992
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Our Investment Team
Jerome L. Dodson
Chairman Lead Portfolio Manager Parnassus Endeavor Fund
Benjamin E. Allen
Chief Executive Officer Portfolio Manager Parnassus Core Equity Fund
Matthew D. Gershuny
Director of Research Lead Portfolio Manager Parnassus Mid Cap Fund
Lori A. Keith
Portfolio Manager Parnassus Mid Cap Fund
Ian Sexsmith, CFA
Portfolio Manager Parnassus Mid Cap Growth Fund
Minh T. Bui Portfolio Manager Parnassus Fixed Income Fund
Robert J. Klaber
Portfolio Manager Parnassus Mid Cap Growth Fund
Samantha D. Palm
Lead Portfolio Manager Parnassus Fixed Income Fund
Billy J. Hwan, CFA, CPA
Portfolio Manager, Parnassus Endeavor Fund
Todd C. Ahlsten
Chief Investment Officer Lead Portfolio Manager Parnassus Core Equity Fund
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We look forward to working with you.
Our ESG Team
Iyassu Essayas
Director of ESG Research
Rachel Nishimoto
Senior Research Analyst
Marissa LaFave
Research Analyst
Visit www.parnassus.com to learn more about the Parnassus Funds.
Read our thought leadership.
Subscribe for updates.
Follow us on social media.
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Effective May 1, 2020, the name of the Parnassus Fund changed to the Parnassus Mid Cap Growth Fund. The Fund’s principal investment strategy changed from a multi-cap fund to a fund that primarily invests in mid-sized growth companies.
The Standard & Poor’s 500 Composite Stock Price Index (also known as the S&P 500) and the Russell MidCap Index are unmanaged indexes of common stocks and it is not possible to invest directly in an index. Index figures do not take any expenses, fees or taxes into account, but mutual fund returns do. The S&P 500 Index is a product of S&P Dow Jones Indices LLC and/or its affiliates and has been licensed for use by Parnassus Investments. Copyright © 2019 by S&P Dow Jones Indices LLC, a subsidiary of McGraw–Hill Financial, Inc., and/or its affiliates. All rights reserved. Redistribution, reproduction and/or photocopying in whole or in part are prohibited without written permission of S&P Dow Jones Indices LLC. For more information on any of S&P Dow Jones Indices LLC’s indices please visit www.spdji.com. S&P® is a registered trademark of Standard & Poor’s Financial Services LLC and Dow Jones® is a registered trademark of Dow Jones Trademark Holdings LLC. Neither S&P Dow Jones Indices LLC, Dow Jones Trademark Holdings LLC, their affiliates nor their third party licensors make any representation or warranty, express or implied, as to the ability of any index to accurately represent the asset class or market sector that it purports to represent and neither S&P Dow Jones Indices LLC, Dow Jones Trademark Holdings LLC, their affiliates nor their third party licensors shall have any liability for any errors, omissions, or interruptions of any index or the data included therein. Parnassus Investments is not affiliated with MSCI, Inc., Standards and Poor’s, Inc, or Russell, Inc.
Risks: The Funds share price may change daily based on the value of its security holdings. Stock markets can be volatile, and stock values fluctuate in response to the asset levels of individual companies and in response to general U.S. and international market and economic conditions. In addition to large-cap companies, the Funds may invest in small- and/or mid-cap companies, which are generally riskier than larger companies, and the Fund’s share price may be more volatile than funds that invest in larger companies. Security holdings in the funds can vary significantly from broad market indexes. Bond fund values fluctuate in response to the financial conditions of individual issuers, general market and economic conditions, and changes in interest rates. In general, when interest rates rise, bond fund values fall, and investors may lose principal value. Security holdings in the fund can vary significantly from broad market indexes. Copyright® 2019 Parnassus Investments. All rights reserved. Mutual fund investing involves risk and loss of principal is possible. 20200424-0290 The Parnassus Funds are underwritten and distributed by Parnassus Funds Distributor, LLC.
There are no assurances the Parnassus Funds investment objectives will be achieved, and no guarantees the socially responsible investment strategies discussed will be successful.
Before investing, an investor should carefully consider the investment objectives, risks, charges and expenses of the fund and should carefully read the prospectus or summary prospectus, which contains this information. A prospectus or summary prospectus can be obtained on the website, www.parnassus.com, or by calling (800) 999–3505.
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