Smith Graham's investment philosophy is predicated on the belief that a disciplined global approach focused on economic fundamentals and market conditions will produce superior long-term risk-adjusted returns. Since our founding in 1990, we have built a reputation for success by being responsive to client needs and by focusing on delivering superior investment performance and the highest quality service. Through our Partnership Perspective, we deliver our specialization of constructing objective based portfolios to corporations, endowments, foundations, public funds, and Taft-Hartley plans.
- The investment objective of our Fixed Income Products is to produce excess returns net of fees relative to client benchmarks. Our Fixed Income strategies identify the desired sector exposure and portfolio duration of each portfolio to best take advantage of economic fundamentals and market conditions to maximize total return.
- The investment objective of our Liquidity Asset Management Products is to obtain a high level of current income that is consistent with capital preservation and liquidity. We employ a liquidity management strategy that identifies the desired weighted-average maturity of each portfolio to best take advantage of economic fundamentals and market conditions to maximize current income.
- The investment objective of the Small Cap Value and Midcap Value Products is to provide our clients with strong relative performance with low risk and low portfolio turnover within the universe of US small cap and mid cap stocks.
Smith Graham employs a disciplined investment process that is applicable across all of our fixed income products. Our Fixed Income investment philosophy has a relative value focus with an emphasis on risk control and risk management. Within this context, we believe that superior long-term returns with low volatility can be achieved by maximizing stable cash flows across the yield curve. Since
approximately 90% of the return in the broad investment grade fixed income market
(as represented by the Barclays Capital Aggregate Index) has come from cash flows
over the past 20 years, we believe that constructing portfolios with securities that
have a stable cash flow profile will help our clients attain the goal of out-performance
with low risk over full market cycles.
Our investment management team has vast experience in constructing portfolios across the continuum of bond and currency markets in a number of strategies which include:
- Core and Core Plus
- Corporate Credit
- Long Duration
As with the partnerships we establish with our clients, our investment performance focus maintains a long term orientation. As such, we seek to outperform our clients' benchmarks net of fees and to be among the top managers in our style or peer group over a full market cycle. We believe the experience, insights and the disciplined approach of our fixed income investment team drives our ability to add value to client portfolios.
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Liquidity Asset Management is a disciplined approach to short-term investment management designed to provide preservation of principal, maintenance of sufficient liquidity, and maximization of current income.
With Smith Graham, liquidity management portfolios can be constructed under three approaches:
- Short Cash
- Enhanced Cash
- Low Duration
Additionally, we have worked closely with many of our clients to combine various
elements of the three primary approaches to customize portfolios
to meet the unique requirements of each client. Our customized
strategies for yield enhancement have received overwhelming
reception in the investment management marketplace.
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Our equity investment philosophy reflects our belief that attractive returns can be achieved over a full market cycle within a small and mid- capitalization universe by combining a systematic quantitative approach with traditional fundamental analysis.
- Small Cap Value
- Midcap Value
We use a series of proprietary investment models based on earnings, book value and cash flow to compare company fundamentals of each stock in our research universe. We combine this data daily and apply a qualitative fundamental overlay to determine the relative attractiveness of each stock in our universe. We then construct a portfolio from the most compelling investment opportunities in our research universe. The resulting portfolio is one whose incremental returns are intended to come from individual stock selection. Our approach is highly disciplined and is intended to minimize many of the common risks found in small cap and mid cap investing.
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For more detailed information about our investment strategies, please contact us.