Investment Style

Many money managers, bank investment departments and mutual funds describe themselves by the universe from which they select stocks.

Some refer to their preference for small or mid-sized companies, others elect to choose from high yield lists or very large Blue Chip firms.

Each grouping has its pluses and minuses. For example, small firms do have the potential in their early years to grow much faster than the GEs or IBMs of the world. They also have not yet built up the experience, capital reserves and market share or image to survive some economic events. Thus, while stock performance may be superior at times, so is the risk of greater stock decline.

Our view is that most of the logic behind such style specific investing is to provide consultants and corporate clients an easy way to label managers – for their own convenience.