In this episode of Behind the Ticker, Brad Roth speaks with Seth Cogswell, Portfolio Manager at Running Oak Capital, about the firm’s flagship ETF—RUNN, the Running Oak Efficient Growth ETF. With a background that spans fundamental equity research and derivatives trading, Cogswell shares his journey to Running Oak and how the firm’s roots in separately managed accounts (SMAs) laid the foundation for its ETF strategy. Originally launched in 2009 for advisors seeking a smoother ride through market cycles, the strategy behind RUNN has delivered strong results with an emphasis on downside protection.
About Seth Cogswell and Running Oak
Cogswell breaks down how RUNN combines a core equity portfolio of 30–50 high-conviction U.S. large-cap stocks with a adaptive allocation to fixed income and cash equivalents. What sets RUNN apart is its ability to dynamically shift its allocation between risk-on and risk-off environments. The fund can reduce equity exposure as low as 30% or raise it up to 90%, based on a rules-based framework that evaluates macro indicators, valuation metrics, and market trends. This allows the fund to dial down risk during market stress and re-enter more aggressively during recovery phases.
Investment Strategy and Approach
The equity sleeve of the portfolio focuses on quality companies with strong free cash flow and sustainable growth—avoiding overvalued, speculative names. Meanwhile, the fixed income sleeve remains flexible, emphasizing high credit quality and shorter durations when risk is elevated. Cogswell notes that RUNN is actively managed daily, with oversight to ensure discipline in both the equity and fixed income allocations. The team also maintains a consistent philosophy that prioritizes risk-adjusted returns and long-term capital appreciation rather than chasing short-term performance.
Designed for use as a core equity holding or a risk-managed growth strategy, RUNN offers advisors and investors an efficient, transparent vehicle to navigate unpredictable markets. With a track record rooted in the firm’s SMA history and now offered in a more tax-efficient ETF format, the fund aims to deliver smoother performance without sacrificing long-term upside.
Deeper Dive: Insights from the Full Conversation
Beyond the headline strategy, the full conversation between Brad and Seth Cogswell covered several additional themes worth highlighting for advisors and investors.
On Process and Philosophy
If you're taking a concentrated approach, maybe you do a very deep fundamental dive on a company and you decide this is a great investment. You do that for some other companies and now you've got a portfolio of high conviction names. We have a totally different approach. We have, particularly me, I have absolute conviction that if we maintain a portfolio with higher and ex-growth, attractive valuations, lower downside risk, that we will, over the long run, provide higher return, lower risk.
The more you flip it though, the more likely it approaches 50%. So, 50% have 50% tails. We look at each company as a coin flip. Each company gives us an opportunity to deliver those qualities that we aim to provide our clients. No, it makes a ton of sense. The whole process is we've talked about is a completely rules-based approach but it is actively managed. So, where do you think the team adds the most value and can you also talk to me about how often you're re-running the process to either select new names, add, remove, re-weight and you can just talk about that a little bit as well.
Market Context and Positioning
It can be really the basis of the strategy as the fact that we don't feel that we are good at predicting the future. Some might be able to do it, but we don't feel that we can. And so the strategy is really based on what we know versus what we don't know. So it's based on three very simple economic principles which are maximized earnings growth because nothing drives performance like earnings growth when you buy a stock, you get to share that company, if that company is growing great, the value is going to grow.
Our goal is to maintain a portfolio consistently that has significantly higher earnings growth in the S&P because, again, nothing drives performance like earnings growth. Historically, the portfolio is averaged around 12 to 13% earnings growth versus the S&P, which is around 67. That's in B's earnings can be wildly volatile. But over the longer in the average around 67, there's reason to think that maybe even that begins to decline a little bit. But regardless, that's about a 6 to 7% gap on average that we maintain that we would expect to drive performance.
But of the long run, stocks can be noisy, right? You've got people buying and selling based on different reasons, emotions and so equal weighting takes advantage of that noise. Now for us, as far as equal weighting versus alternative weightings, that's something that I've thought about a lot. In that really touches on an important philosophical point of our strategy which as many managers have heard, maybe not heard, but lean toward more concentrated approaches because that's a way to differentiate yourself from the indexes potentially provide outsized returns.
Notable Insights
"The valuation is the way in which we value companies is certainly one of the biggest differentiators."
"So, the difference between passive and active or the definition, I feel like is ever changing."
Key Takeaways
- Cogswell breaks down how RUNN combines a core equity portfolio of 30–50 high-conviction U.S.
- This allows the fund to dial down risk during market stress and re-enter more aggressively during recovery phases.
- The equity sleeve of the portfolio focuses on quality companies with strong free cash flow and sustainable growth—avoiding overvalued, speculative names.
- Cogswell notes that RUNN is actively managed daily, with oversight to ensure discipline in both the equity and fixed income allocations.
- Designed for use as a core equity holding or a risk-managed growth strategy, RUNN offers advisors and investors an efficient, transparent vehicle to navigate unpredictable markets.
- With a track record rooted in the firm’s SMA history and now offered in a more tax-efficient ETF format, the fund aims to deliver smoother performance without sacrificing long-term upside.
What This Means for Advisors
For financial advisors evaluating options for client portfolios, this conversation with Seth Cogswell highlights important considerations around small & mid cap. 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 small & mid cap and portfolio construction 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 Seth Cogswell, including additional nuances and details, listen on Spotify, Apple Podcasts, or watch on YouTube.