Investment Process

High-quality companies

• Leading market franchise
• Strong balance sheet
• Favorable trends in cash flow and earnings

Thorough research

• Prospects for Revenues
• Existing margins and earnings prospects
• Quality of earnings.
• Determination of fair value for the shares

Sell discipline

• Fair value review. Shares trading in excess of fair value are candidates for sale.
• Exceptional relative performance may be reason for (partial) sale.
• Alternative investment opportunities or the need to shift sector weights may also be reason for sale.

Portfolio construction

• Common stocks provide substantially greater long-term returns than fixed income securities.
• Common stock returns are more volatile than fixed income returns.
• Through portfolio construction (asset allocation), the higher and more volatile common stock returns are combined with the lower and more stable fixed income returns to meet the circumstances of the individual or institutional investor.

Because the stock market moves in short bursts, in order to capture the incremental return afforded by equities, it is essential that the investor remain fully invested. Thus substantitive changes in asset allocation are driven by changes in investor circumstances rather than an anticipated stock market moves.

The equity portion of the portfolio is made up of large-cap and mid-cap companies diversified among broad industry sectors, including: Finance, Consumer Goods and Services, Industrial Goods and Services, Technology, Health Services, Utilities and Telecommunications.

Representative Holdings