Our Investment Management Process

Qualitative Analysis
Our process begins with a qualitative analysis at the investment company level. We work with select investment companies that meet the following qualitative criteria:

  1. A company that shares our views that investing requires a long-term perspective
  2. A company that has a long history of success both at the company level and at the performance level
  3. A company that relies on team resources to manage their strategies
  4. A company that uses traditional top-down or bottom-up management style in its equity analysis and does not use tactical or algorithm driven equity management
  5. A company that can offer strategies in multiple areas of the market; a diverse security lineup

Quantitative Analysis
After our qualitative analysis, we assess investments using various criteria such as Return vs. Category, Alpha, Sharpe Ratio, Up/Down Capture Ratio, Turnover and Expense Ratio. We believe the analysis of these factors allows us to strategically allocate by utilizing the unique characteristics of each investment.

Portfolio Management
After our two layer screening process, we focus on strategic asset allocation. We start with building a core of passively-managed index strategies and wrap that core with active strategies to achieve our desired allocation. We tilt our portfolios to weight towards academically supported factors such as value stocks, small cap stocks and international stocks. We do not take one side in the active vs. passive debate, but rather, use the strengths of both strategies to build an allocation that we believe can deliver our desired outcome in multiple market conditions.

Ongoing Monitoring
Our ongoing management focuses on strategic asset allocation. We monitor all of our models quarterly and discuss whether or not any changes are warranted. We also believe in the academically supported research regarding the rebalancing of portfolios. Investment company and individual investment analyses happen annually. We rate our investment line up using our long-term investing lens, looking at 3, 5, and 10-year metrics on each investment. If a security receives a failing grade, it goes on our watch list and is ultimately replaced after 1 year of underperformance.

Conclusion
Our Investment Review Committee has created a stringent, detailed, and clear process that aligns with our beliefs on asset management. We invest for the long-term, focus of the risk/reward characteristics of investments and strategically allocate to pursue clients’ goals. We believe that this process eliminates some ambiguity in security selection and is designed to provide a consistent investing experience for our clients.

Do you have questions or would you like to have a conversation?
Call us at 717-581-1323 or use the below contact form.

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