Security Selection Process

Our security selection process differs based on the asset class and type of security.  The types of securities we recommend that our clients include in their portfolios are typically driven by such factors as account size, ownership, restrictions and the need to defer taxes.  Typically we will not introduce individual stocks to the portfolio unless the account has a value in excess of $150,000.  We believe that below this amount, the client is better served using mutual funds in order to achieve a sufficient level of diversification and low expense ratios.

Individuals Stocks

We manage both a large cap and mid cap individual stock portfolio.  Each of these strategies has a history of above market returns with below market risk. 

Our portfolios are well diversified across all industry sectors.  Our analysis of the current economic cycle and where we think the economy is trending will cause us to overweight certain market sectors and underweight others.  We then select those stocks that we feel will offer the best change for future growth within each market sector.  Our portfolios typically have between 25 and 30 stocks with a turnover ratio of around 30%.

We screen a database of stocks based on a variety of fundamental ratios such as debt to equity, price to earnings, and forward earnings per share growth rates.  We are looking for companies that we believe will experience above average earnings growth that can be purchased at or below average PE ratios.

We then assess the management of those companies and how they are compensated to make sure their interests are aligned with those of the shareholders.

We will typically sell those positions if the earnings growth rates significantly decline, the PE gets ahead of itself or there is a significant change in management for no apparent good reason.


Fixed Income

The primary objective of our fixed income strategy is to protect principal with a competitive yield.  We only buy investment grade bonds for inclusion in our client’s portfolios.  We do not actively trade these securities in response to movements in interest rates.  Our strategy is to ladder the maturities of our fixed income positions over a three year time span.  This enables us to reinvest 33% of the portfolio each year to take advantage of the interest rate environment in effect at that time.  We position our maturities to maximize the yield based on the fixed income yield curve.


Global Investments

Over the last several decades, entire industries have left the United States. Many of the products we are consuming here at home are manufactured and assembled outside of our borders.  We believe that it is both necessary and prudent to invest a portion of our client’s portfolios outside of the United States, in order to take advantage of the ever growing and inter-connected global economy.  We utilize outside portfolio managers to invest our client’s assets in the form of mutual funds or global investment managers.  These institutions posses the research capabilities to assess the many global opportunities we are seeking.  We continually monitor their performance against their peers and benchmarks, to assure our clients are achieving above average returns with equal or lower risk.


Real Estate Investment Trusts

Our strategy for participating in real estate is to invest in either exchange traded real estate investment trusts or, on occasion, private placements.  Real estate has proven to be a good hedge in those times the equity markets have declined.


Mutual Funds

The mutual funds we select must meet various criteria.  They must be no-load or load waived funds, their expenses ratios should be below average, they must have demonstrated consistent returns, they must have outperformed most other funds with their same stated investment objective and most importantly the current management must be the same people who were responsible for achieving the returns we are analyzing.