Philosophy & Process

Investment Philosophy

  • We believe that companies with significant cash flow, that generate significant dividend income, and that are attractively valued relative to the market and their peers, can provide a stable source of total return over the long term.
  • We believe that a portfolio of reasonably valued companies, whose earnings are currently growing and are well-positioned to continue to grow on a sustained basis, can add value for clients over the long term.
  • We believe that a rigorous sell discipline and diligent monitoring and control of portfolio risks are required to protect our clients’ investments from downside market volatility.
  • We believe in concentrated portfolios that allow each individual investment to have a meaningful impact on the overall return.
  • We believe in actively managng portfolios to pursue a clearly-defined investment objective, rather than managing to a passive index that is designed to replicate a market segment.

Security Selection

The team conducts ongoing analysis of both current and potential holdings to ensure that portfolios are comprised of the best possible opportunities at any given time.

Bottom-Up

We assess and respond to changes that impact dividend yield, valuation, and the outlook for earnings growth and capital appreciation:

  • Management changes
  • Product launches
  • Sales trends
  • Research and development
  • Dividend trends

Top-Down

We evaluate and act upon macro changes that have repercussions for the portfolio:

  • Economic
  • Political
  • Social
  • Demographic

Sell Discipline

A rigorous sell discipline is a key means of protecting clients from:

  • the cost of holding a company whose investment potential is deteriorating in absolute terms
  • the opportunity cost of holding a company whose investment potential is less attractive than that of an alternate candidate

As such, we maintain a robust list of substitution candidates, and do not hesitate to sell a security quickly when we see:

  • a superior alternative
  • a potential decrease in dividend payments or earnings growth
  • a shift in company fundamentals
  • a valuation concern
  • an excessive risk factor

Tax Sensitivity

We understand that taxes have real world implications for our clients. As a result, we integrate tax sensitivity into all investment decision making for taxable accounts.

Tax considerations may manifest themselves in:

  • the types of securities in which we invest
  • the underlying companies in which we invest
  • the timing of purchases and sales
  • the harvesting of investment gains or losses at a client’s request.

In addition, we frequently work with clients’ accountants or financial advisors to facilitate a broader tax strategy that may have been established for the client.

Client Service

Gilman Hill Asset Management takes great pride in its ability to provide all clients with institutional-quality client servicing, without compromising the close personal relationships that can only be achieved in a boutique setting.

The objective is to establish a true partnership, whereby the client understands what is happening in their portfolio and how their returns were achieved, and GHAM understands the needs of the client and how they are evolving.

This is accomplished by frequent, direct interaction between the client and their portfolio manager, and is supported by the firm’s ongoing investment of time and capital to maintain a leadership position in communications, technology, and reporting.

The result of this commitment is, we believe, a level of service that meets the exacting accounting, reporting, and analytic standards of the institutional investment community, while still providing unparalleled personal attention and direct accountability.

Gilman Hill Asset Management