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Investment Strategy
Multi-disciplinary Approach
Dumont & Blake
developed and employs a unique multidisciplinary approach to managing equity
investments, designed to provide consistent, above-average investment returns
with equal or less risk and volatility than the S&P 500 index. This approach
provides for complete and balanced portfolio diversification in one investment
package.
 The approach is based on three major investment
disciplines employed by portfolio managers; each discipline allows the manager
to select stocks based on certain criteria. These disciplines, sometimes
referred to as investment styles, are 1) Growth, 2) Value, and 3) Growth at a
Reasonable Price (GARP).
The Growth manager looks for companies that have
good long-term growth of sales and earnings as well as strong earnings momentum
in the short-term. Generally these are popular, well-known companies, and are
rarely priced cheaply.
The Value manager looks for companies that are out
of favor and have been beaten down to attractive or cheap prices. Value
companies generally have had a decent long-term record but are experiencing
short-term problems which have caused earnings to decline. The Value manager has
to assess whether the decline is temporary or the beginning of a major decline
or stagnation of earnings.
 The Growth at a Reasonable Price (GARP) manager
looks for companies that have above average earnings and sales growth but that
are priced lower than the companies sought out by the Growth manager. Unlike the
Growth manager the GARP manager is price-sensitive. The GARP manager employs the
combined analysis and valuation tools of the Growth and Value managers.
The Dumont & Blake multi-disciplinary approach employs the three
major disciplines to manage client portfolios. The approach is based on the view
that in order to outperform the S&P 500 on a consistent basis one must have
a properly diversified portfolio consisting of growth, value, and GARP stocks.
The securities are diversified into eight economic sectors and selected in such
a way that the portfolio has a high probability of outperforming the S&P 500
benchmark index. The individual stock selection utilizes our relative valuation
model which derives a fair value, high value, and low value for each stock
relative to the S&P 500. By combining good quality companies selling at fair
value or below, and diversifying the stocks into the appropriate economic
sectors, we can structure an equity portfolio with a positive risk-reward ratio
having a high probability of outperforming in both up and down
markets.
Clients' total portfolio performance is based on the appropriate
asset allocation between stocks, bonds, and cash. Investment performance from
the equity portion of clients' portfolios is derived from superior security
selection utilizing the Multidisciplinary Approach.
Other benefits of
the multidisciplinary approach
-Allows for participation in the
high-return sectors of the market for part of the portfolio. Managers who avoid
popular sectors of the market typically under-perform compared to the S&P
500 index.
-Allows more consistent portfolio performance over
time.
-Eliminates the need to hire several different management firms to
prudently diversify your portfolio.
-Reduces paperwork and mail by
having one investment manager rather than many.
-Assures proper
portfolio diversification because one manager is coordinating the sector and
industry diversification. Avoids duplication of holdings and having one manager
buying a stock and the other manager selling the same
stock.
Beyond Investments
Dumont
& Blake also provides financial counseling and coordination services. We
will work with you to determine your financial goals and objectives and then
formulate a long-term plan to help you achieve these goals. We will then act as
a liaison between your accountant and lawyer to expedite these plans. Working as
a team with your other professional advisors we will work to minimize taxes and
facilitate proper estate planning. Periodic meetings with you and your
professional advisors at Dumont & Blake will take place to review investment
results and discuss what changes, if any, are appropriate for the future.
Working with Dumont & Blake you have direct access to the principals
of the firm, real people who know you and your particular investment concerns.
We have an important and unique relationship, you are not just an account
number. Your portfolio and investment[top] needs are treated with individual
attention and care.
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