We believe the most successful philosophy in building wealth for our clients requires a disciplined investment approach together with a long-term view of the markets. Consequently, market-timing and other short-term strategies are not part of the process in attempting to earn above-average rates of return. We offer portfolios that are comprised entirely of common stocks as well as a mixture of both stocks and bonds.
Our Investment Approach
The center of equity (common stocks) portfolio management at JLB & Associates is a well-defined analytical process for selecting common stocks and a disciplined procedure for investing individual portfolios in those stock selections. Our common stock selection process is driven by our universe of two hundred companies, which is ranked based on their expected investment returns.
Our 200 Common Stock Universe contains companies that are highly profitable, have relatively low debt, retain a large portion of their earnings, and appear attractively valued compared with the overall market. With rare exception, the stocks are of companies incorporated in the United States, many of which have large international operations. The universe is comprised of small, medium, and large capitalization companies.
The goal of the common stock portion of a client’s portfolio is to outperform the Standard & Poor’s 500 Composite Stock Index measured over a three to five year time horizon.
The procedure for managing fixed income portfolios is to select high quality bonds that are rated “investment grade” (Baa/BBB or better) at the time of purchase. Bonds with unusually long maturities and callable bonds are avoided.
Based on the outlook for interest rates, a decision may be made to lengthen or shorten the maturity structure of a client’s portfolio. Usually such an adjustment is gradual and without a high rate of turnover.