Investment Philosophy:
We invest in high-quality stocks that hold the promise for above-average earnings growth: growth that is consistent and above what investors expect or anticipate.  Return on equity is the single best proxy for earnings growth, cash flow growth and management effectiveness in managing shareholder capital.

Portfolio Construction:
Core Equities is a diversified portfolio of 40 holdings. The Core portfolio is comprised of high quality companies in a range of large and mid-cap stocks. Large cap stocks will represent 60%-90% of the portfolio and mid-cap stocks will represent 10%-40%.

Buy Discipline - Growth Stocks (60%-90%):
We employ a proprietary, multi-factor model to discern key investment fundamentals and trading characteristics.  In our view, these yield important information about optimal investment opportunities.  Used in conjunction with the Compustat database, we can consistently analyze over 2,000 large and mid-cap stocks in a structured, disciplined framework.  We are looking for "best of class" growth companies which are also reasonably valued.  The key investment factors which are addressed within our quantitative stock selection model are:

Earnings Growth Earnings Persistency Earnings Quality

Valuation Market Recognition

Buy Discipline - Value Stocks (10%-40%):
Independent research and quantitative (stock-screening) techniques are utilized to find viable investment candidates.  We are looking for companies with improving operating fundamentals, inexpensive valuation, a non-threatening balance sheet and dividend-paying capabilities.  Following are some of the key value stock investment factors and relationships which are analyzed:

Sell Discipline:
We are governed by a sell discipline which we refer to as the "25/25 trigger."  When a stock declines by 25% from our clients' original purchase cost, it is sold. When a stock appreciates by 25% from our clients' original purchase cost, we re-establish the downside "trigger" price at 75% of the appreciated price.