Investment Philosophy

Common Stocks

Our equity philosophy is based on two factors – fundamental value and relative strength.

The essential ingredient in our fundamental approach is a highly disciplined security valuation process that searches for undervalued securities through our proprietary screening techniques. Many value stocks, however, often remain undervalued for extended periods of time, so we must select securities that will produce superior results. We seek those companies having a potential catalyst that will cause a revaluation by the market, resulting in a higher stock price. This catalyst factor can include product innovation, asset redeployment, new management, or even potential merger or sale.

Relative strength is used to identify areas of opportunity in industry groups and individual securities, and to aid in the execution process by highlighting entry and exit points.

Portfolios are diversified over a range of industry sectors and companies with typically at least twenty individual equity holdings.


The primary objectives of our fixed income investment process is to provide consistent income with a reduced level of asset volatility. Our secondary objective is to capture capital gains and improve total portfolio return.

To accomplish these objectives, we construct a typical fixed income portfolio around a foundation core of high quality government, government agency, corporate, and municipal bonds. This foundation core provides a stable source of current income to the portfolio and assures a reduced level of asset volatility.

The remaining assets allocated to fixed income are invested in accordance with our forecast for interest rates. We trend this balance toward the maximum maturity range when we are in a period of falling interest rates, and shorten to a minimum maturity range when rates are rising. No securities below investment grade ‘BBB’ or that mature beyond ten years are ever purchased. Municipal bonds are used only in taxable accounts.


The main purpose in using a balanced investment philosophy is to reduce the risks inherent in common stock investments and to provide growth opportunities missing in bond investments. The word “balanced” is a misnomer for it implies that assets are split equally between stocks and bonds, when in fact assets are divided between these two asset classes plus a cash/money market equivalent. In order to achieve the investment objectives of a client, these three components must be actively managed and allocated properly based upon our expected rates of return of each over a specific time horizon.

Mutual Funds

Superior mutual fund investment returns result from a portfolio of careful selected, broadly diversified, no load, “Best of Breed” mutual funds of varying asset classes that are actively managed utilizing a long-term investment time horizon.

We allocate client’s assets based upon their risk tolerance and risk capacity, to create a comfort level of return. As market conditions change, the asset allocation is actively managed and adjusted to maintain a client’s comfort level and to produce superior investment returns.

The mutual funds selected are carefully and continuously screened for overall performance and consistency of investment style. Investment manager stability and a minimum of a three year performance record are important considerations.

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