Roof Advisory Group, Inc. - Investmant Advisory and Financial Planning Services Roof Advisory Group, Inc. - Investmant Advisory and Financial Planning Services
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Portfolio Management


Roof Advisory Group's professional portfolio management process is focused and disciplined. It is designed to control downside portfolio risk while optimizing overall investment return when compared to clearly identified benchmarks. Clients receive non-biased professional portfolio management they can trust, reflecting the firm's core concepts of integrity, expertise and service.

Portfolio Management Process

Each client's investment situation is unique and addressed as such. Our clientele look to us to proactively manage their assets in a way that maximizes return within jointly determined risk parameters. Toward this end, a comprehensive, three-tier approach is taken in the firm's portfolio management process.

Initially, most new clients have never developed a clear investment strategy, much less a defined investment policy. This is the first step of our management process. Areas of focus in formulating an appropriate investment strategy/policy are outlined below:

Investment Strategy/Policy:
Long-term goals
Financial objectives
Risk tolerance
Income/principal needs
Return expectations
Document restrictions

Once an appropriate investment policy is developed for a specific client, the firm's method of disciplined management seeks to effectively optimize portfolio return within the client's quantified risk guidelines. Essential to this process is developing, implementing, and monitoring each client's portfolio/asset allocation and structure versus key benchmarks. Diversification at all levels is critical. Several of these benchmarks are listed below.

Portfolio/Asset Allocation:
Asset class/style exposure
Industry sector exposure
Maturity/rate exposure
Historic variation
Projected volatility
Comparative performance

Finally, a defined security selection process is utilized in both the initial establishment and ongoing management of a client's portfolio. This applies to both equity and fixed income investments. Highlights of the selection process listed below.

Security Selection:
Quality-driven, risk control
Buy/sell fund discipline
Performance versus peers
Performance versus benchmark
Existing constraints

Additional detail on the firm's equity and fixed income selection process is outlined below:

Equity Selection:
Based on overall portfolio size; individual equities, mutual funds, exchange traded funds (ETF), or a combination thereof may be used in constructing the equity portion of a clients' portfolio. The firm recognizes the benefit provided by utilizing multiple managers with specialized expertise in specific areas, such as international and mid/small equities, and will periodically utilize high-quality, low-cost mutual funds with established track records of high performance to fill this need.

A fundamental 'value-style' approach is used when actively managing the individual stocks that comprise the majority of the equity position in our clients' investment portfolios. Specifically, we define this group of stocks as companies with solid earnings, low corporate debt, notable one year appreciation potential (10% plus), reasonable valuation (P/E ratios below 15), and dividend yields exceeding 2%. Tax efficiency is a consideration in all taxable accounts.

Fixed Income Selection:
Individual bond issues are used whenever overall portfolio size permits the achievement of appropriate fixed income diversification. The use of individual bonds also provided greater control of fixed income quality, maturity, and yield. High-quality, investment grade (BBB and better) bonds with a short to intermediate term maturity (5-15 years) are typically used in non-taxable accounts, with high-quality municipal bonds utilized in taxable situations.

The aggregate duration of a fixed income portfolio is managed based on relevant market factors. Overall bond quality and portfolio diversification is not sacrificed in the pursuit of yield. The fixed income portion of a client's portfolio is used to temper, not enhance, volatility. Likewise, the fixed income investments are seldom traded for the purpose of realizing valuation changes.

Investment Research:
Roof Advisory Group utilizes an expansive variety of diverse research sources. Research reviewed ranges from economic forecasting to in-depth individual security analysis. Primary sources include: Standard & Poor's, Argus Research, Goldman Sachs, Value Line, Bloomberg, Morningstar, Reuters/First Call, and Dow Jones. Secondary sources include:, J.P. Morgan, Charles Schwab, Merrill Lynch, and other numerous providers.

Custody of Assets:
Roof Advisory Group does not take direct custody of the assets that we manage on your behalf. Your assets will be maintained in accounts at a "qualified custodian"; a registered broker-dealer and member SIPC. The "qualified custodian" will hold your assets in brokerage accounts and will buy and sell securities upon our instruction.



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