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
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:
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.
|Asset class/style exposure
Industry sector exposure
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
| Quality-driven, risk control
Buy/sell fund discipline
Performance versus peers
Performance versus benchmark
Additional detail on the firm's equity and fixed income selection
process is outlined below:
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
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.
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: Briefing.com, 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.