How Our Investment Approach Adds Value

Having agreed the long term investment objective and the level of risk to be taken with each of our clients, we endeavour to add value to their investment portfolios in two ways. First by strategic and tactical asset allocation i.e. the proportion of funds to be invested in a mix of complimentary asset classes such as gilts and fixed interest stocks, index linked securities, domestic and overseas equities and cash. Secondly through stock selection.

Asset Allocation
The process for deciding upon asset allocation involves weekly investment meetings of our fund managers and an external consultant when macro economic views are discussed and broad guidance on asset allocation are agreed. The output from these meetings is then applied to individual portfolios depending to their specific investment requirements.

Stock Selection
Our stock selection procedure has a strong value bias. Our ‘VAGMAN’ process used for identifying undervalued / overvalued situations incorporates a number of complimentary quantitative tests. Each month an initial screening of the leading 350 UK stocks is made to identify those offering the following characteristics : Value – above average yield, Growth – a low price earnings to growth ratio (PEG), Momentum – good / bad relative share price performance against the market and Newsflow – broker upgrades / downgrades to profits and earnings forecasts.

After the initial screening, further research is then conducted for those companies with the highest / lowest ratings using internal and external brokers’ material and buy and sell recommendations are then produced.

We believe that our disciplined process fits well with those investors wishing to achieve either an above average overall return or have certain income requirements.