Our Investment approach

We have constructed six portfolios to address our clients' various risk tolerances, investment horizons, or preferences for certain types of investments.  

KENTUCKY SELECT PORTFOLIO

We believe that when looking for unique investment opportunities it can be advantageous to focus closer to home. With the U.S. economy shifting from a manufacturing economy to a distribution and a services economy, we feel Kentucky is well positioned for the future. The portfolio is designed to take advantage of the new way the world is doing business. The Kentucky Select Portfolio invests in companies that are based in Kentucky or have a major presence, with approximately 750 employees or more. This combination results in a portfolio of securities that have been chosen on factors beyond just the specifics of one company’s business and allows our managers to factor in multiple inputs when evaluating a decision. The resulting portfolio is one which contains companies that best reflect Kentucky and its unique position in the emerging service economy. Our team approach combines the analysis of macroeconomic trends along with fundamental characteristics and technical trends. Investing in the places where we work, shop, and eat may not only be a good investment for you, but it is beneficial for Kentucky.

INTERNATIONAL PORTFOLIO

Most approaches to international portfolio construction ignore the fact that every country has unique legal, regulatory, and economic infrastructures. The resulting differences in individual country economies have implications for equity valuations. If country-level information impacts financial projections and those projections are very important to investment decisions, then country-level information should impact investment decisions. The more honest and transparent a country is with its citizens, businesses, and investors, the more wealth is created in the country. Just because laws and regulations are in place does not mean that they are enforced. A key factor in determining good governance is behavior versus intent, and this is where Magni is most differentiated from other similar types of research organizations. Measuring good governance is not easy. When deciding on metrics for good governance, there must be a method to determine the adherence to good governance practices in an objective and repeatable manner. The use of public information enables widespread and overlapping assessments that in turn lead to more uniform and more complete understanding of the realities in a country. Magni's research database contains data on280 Qualitative Sovereign Factors grouped into12 Economic Standards and updated monthly over the past16 years to determine an _______________________

LARGE CAP SECTOR   PORTFOLIO

The McCrea-Bollinger Large Cap Sector Portfolio uses a disciplined investment approach, using a diversified portfolio of approximately 25-35 stocks. The portfolio emphasizes market sectors that we expect to outperform the market as a whole. The sector analysis considers: economic growth, productivity, corporate profits, cash flow, fiscal and monetary policy, and individual sector growth. Each sector is carefully analyzed using secular trends, demographics, emerging themes, cyclical/structural characteristics, and other externalities. The process emphasizes sectors that we believe should outperform in the economic, financial and market environment without exposing the portfolio to excessive risk. The Large Cap Sector Portfolio, with few exceptions, concentrates on the 200 largest companies in the S&P 500. The managers focus primarily on high-quality, large-cap companies with above average near term potential within the given sector. Stocks are selected within each sector usinga careful review of each company's financial statement, long term earnings growth potential, and relative value based on historic measures. This narrows the universe to 25-35 companies. Generally two to five companies in each sector are then selected for the Portfolio.

LARGE CAP CONCENTRATED   PORTFOLIO

McCrea-Bollinger's Large Cap Concentrated Portfolio uses a disciplined investment approach, using a diversified portfolio of approximately 12-18 stocks. The portfolio emphasizes market sectors that we expect to outperform the market as a whole. The managers focus primarily on high-quality, large-cap companies with above average near term potential within the given sector. The portfolio generally will use stocks in the MB Large Cap Sector Portfolio. The Large Cap Sector Portfolio, with few exceptions, concentrates on the 200 largest companies in the S&P 500. Stocks are selected within each sector using a careful review of each company's financial statement, long-term earnings growth potential, and relative value based on historic measures. This narrows the universe to 25-35 companies. The Large Cap Concentrated Portfolio further narrows the selection to one to three companies in each sector with the highest near-term potential.

EQUITY INCOME PORTFOLIO

The McCrea-Bollinger Equity Income Portfolio seeks a combination of above- average income and modest capital appreciation by investing across multiple equity and fixed income asset classes. The primary objective is to provide an income above the interest rate on the US Ten Year Treasury Bond while minimizing overall portfolio volatility. The secondary objective is to attain modest growth in the income as well as with long term capital appreciation. The character of the financial markets is considered as the managers assess liquidity, domestic interest rates, the yield curve, earnings yield and global interest rates. The portfolio will be diversified into fixed and variable income investments, as well as higher yielding equities. A portion of the portfolio may also invest in real estate (REITs) and Master Limited Partnerships (MLPs). The portfolio provides a prudent alternative for clients who seek diversification opportunities and attractive total rates of return relative to traditional fixed income securities such as CDs, corporate bonds and government securities.

AGGRESSIVE EQUITY PORTFOLIO

The portfolio focuses on the small/mid-cap marketplace with the idea that superior earnings growth drives investment returns over time. The portfolio follows a bottom-up approach that focuses on the individual companies rather than the broad market as a whole. Companies with competitive advantages offer the best prospects for substantial increases in revenue and earnings growth. The risk of short-term volatility is offset by the long-term potential. The primary strategy looks for companies that have high earnings growth and above average stock price performance. Companies should have growth potential of 20% or more and preference is given for companies that have exhibited consistent, above average growth over the past 5 years. Year-over-year earnings growth should rank in the top 20% of all companies. Earnings growth should be accompanied by strong revenue growth. Preference is given for companies exhibiting strong balance sheets, competitive products, innovative marketing and proprietary technology. Market capitalization is generally between $500 million and $10 billion. This growth-oriented philosophy is suitable only for aggressive, long-term investors.

We utilize five mutual fund companies to address our clients' various risk tolerances, investment horizons, or preferences for certain types of investments.