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Home : Strategy Discussion : Equity Strategy |
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Analytic's equity management strategy begins with selection of an appropriate performance benchmark. Then, assisted by our computer models, we perform an exhaustive analysis of the five key elements that we believe factor into each stock's
attractiveness:
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Relative Valuation - Variables such as earnings to price, book-to-price, and cash flow to price |
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Growth Potential - Variables such as profit margin, earnings growth and return on equity |
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Historical Returns - Variables such as stock's one-month, 12-month and 36-month returns |
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Liquidity - Variables such as market capitalization, price per share and trading volume |
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Risk - Variables such as beta, volatilty, debt-to-equity ratio |
To derive the true measure of a security's attractiveness, Analytic Investors combines the common variables listed above in uncommon ways. Our portfolio construction process achieves diversification while maintaining strict adherence to client
guidelines. To add value, we constantly study the relationships among the variables and adjust their respective weights. This adaptive weighting scheme favors those variables that have contributed to recent performance.
In constructing our clients' portfolios, Analytic Investors
seeks the most efficient combination of stocks with the potential to produce risk-adjusted returns that surpass the benchmark. We strive to achieve near-neutrality in the portfolios' exposure to firm size, economic sector and equity style. We also seek to limit the portfolios' exposure to any
single equity issue. We want the portfolio to behave like the benchmark, while our active management techniques seek to enhance performance and reduce volatility by assigning weights to more than 70 variables.
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Dedicated to Active Management |
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Analytic Investors is dedicated to active investment management. We continuously measure and recalculate both constants and adaptive parameters to ensure that the portfolio is optimized. Constants weighing in to portfolio construction include:
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The performance benchmark for each respective portfolio; |
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The risk constraints of a portfolio against the benchmark; |
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The instruments available to the portfolio. |
Adaptive measures will include:
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The rank and weightings of the variables in each of Analytic's proprietary models; |
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The set of variables included in the models. |
Institutional Investors
To learn more about the services Analytic Investors offers to its institutional clients, see Investing With Us, or choose an institutional portfolio from the list to the right.
Mutual Fund Investors
Individuals can invest with Analytic through several mutual funds available from Analytic and Old Mutual Advisor Funds II. Visit the Investing With Us Mutual Funds Area to learn more.
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