Chicago Equity Advisors (CEA) is an Investment Management Company founded in 2011. The firm operates Chicago Equity Advisors Fund 1 and separately managed accounts (SMAs).
About the Company
Over the last 35 years, Tony Graffia, the firm’s founder and Managing Member, has invested his personal funds in venture capital, private equity, debt financing, and publicly traded securities. Tony has purchased and sold several small businesses in the online retail, manufacturing, leasing, and electronics industries. Currently, he maintains 11 of these entities. Company management teams are based in the same office as CEA.
CEA’s investment strategy is based on Tony’s experience and knowledge streams. CEA’s advantage exists in its ability to complement macro-economic trends with insights provided by Tony’s personal investments in order to create a rigorous set of criteria when evaluating potential investments. CEA’s Investment process includes:
- Identifying a favorable macroeconomic environment for a specific market segment
- Determining if this forecast can be supported by knowledge of that segment acquired from the various private investments
- Once the segment is selected based on macro- economic research and/or internal segment- specific insights, we then turn to individual asset selection.
Strategy in Action
A prime example of our proprietary strategy at work is our decision to invest in transports such as JBHT, ODFL, and UNP. This investment was driven by insights from across all our portfolio of private companies. Our private companies have a substantial portion of their supply chains based in east Asia. As the pandemic raged on in 4Q2020 and 1Q2021, we began noticing significant price spikes in transpacific to Midwest US shipping. Freight prices were eating away at margin and increasing between 3-5x. Our investment team began researching a broad range of freight companies between road, rail, sea, and air. We arrived at the conclusion we needed freight companies with west-coast US exposure that were positioned to exploit the backup in cargo containers at the ports. We avoided ocean carriers due to the cost associated with long dwell times outside ports, and air freight was removed due to the low volume relative to land transports. We took positions in JBHT and ODFL to cover LTL, contract, and supply chain services. We also amassed a UNP position due to their national exposure and healthy balance sheet. Each of these companies had demonstrated their ability to control cost relative to the price inflation that was passed on to customers.
CEA Principal and Key Personnel Bios
Delivering Excellence and Alpha Solutions
Chicago Equity Advisors takes pride in its role as a responsible steward of capital, performing under the highest degree of ethical standards, and committed to delivering consistent returns.