Our Proprietary Three Bucket Approach
We invest our clients' money into a diversified basket of three asset classes. The concentrated equity portfolio is where we seek to generate alpha for our clients. The mutual fund portion is where we select other managers to generate alpha in areas outside our circle of competence. Finally the fixed income and alternative investments portion is meant to smooth out the bumps in the road and generate income.
Each client will have percentage of their assets allocated to each bucket. Depending upon the client's goals, objectives, risk tolerance and time frame we agree upon an appropriate asset allocation.
Equities: Our strategy is built around following a repeatable value based approach to investing. We seek out companies that consist of a combination of good businesses (high return on capital) that are trading at low valuations (pe, ebitda/ev). We focus on companies we understand, have significant assets such as cash, customers, patents and a potential catalyst to wake investors up to the investment in the future.
Mutual Funds: We recommend to our clients what we believe is the appropriate asset allocation between the various equity sectors. We then seek out the best mutual fund managers to manage each portion of the portfolio. We then continue rebalancing and monitoring the portfolio.
Fixed Income: When building fixed income portfolios we will take into consideration many variables such as the type of account (taxable or tax deferred), maturities, credit ratings and geography. Where appropriate we recommend a mix of municipal bonds,government bonds, corporate bonds, cds, bond funds and preferred stocks.
We manage both: Discretionary and Non-discretionary accounts.
Discretionary accounts: Minimum - $100,000. This is an actively managed account where we
typically own anywhere from 12 to 18 positions. The annual management fee ranges from .75%
- 1.75% based on the value of the account. The advantage of a discretionary account is that
neither emotion nor timing is a factor in managing the client’s account. Unlike mutual funds
(where you have no access to the manager), you have full access to us should you wish to discuss
what we are doing, why we have made a certain investment or simply to provide feedback.
Non-discretionary accounts: Minimum - $100,000. We work with clients on a case-by-case
scenario. The annual management fee ranges from .75% - 1.75% based on the value of the
Lowell Road uses TD Ameritrade as the custodian for all client assets. TD Ameritrade was
founded in 1975 and currently holds over $400 billion in assets for over 6 million customers. TD
provides monthly statements, confirms and online access for all Lowell Road clients.