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Investment Philosophy and Process

We offer separately managed equity accounts and no load equity mutual funds for our clients who want to grow their assets over a long period of time. For fixed income, we offer no load bond funds and individual bonds, both taxable and tax free.

Stock philosophy

For our separately managed accounts, we believe in a concentrated portfolio. We have stated before that we aim not just to be successful but to be different. One of the reasons why 80% of money managers do not beat the market returns is because they over diversify and resemble closet index funds. By focusing on our best ideas, we avoid holding an excess of mediocre companies simply to have access to certain sectors. It is the number of quality companies that you hold that determine positive results. We tend to hold between 25-30 companies in our portfolios. While in the very short term, the performance can be volatile, the long term results have been to the benefit of our clients. We use the market volatility to our advantage by using the cash that we have on the sidelines by either adding to our positions or taking new positions. While most money managers (especially mutual fund managers) are usually fully-invested, on average, we have between 5-15% of the portfolio in cash. Historically, on rare occasions, the cash balances have ranged up to 50% of the assets in the portfolio. Weinstat Wealth Management, Inc. acknowledges that cash is an inefficient use of capital. We also acknowledge that it is imperative to have a sufficient cash cushion to take advantage of the buying opportunities that the market provides during pull backs and corrections. This strategy is fully disclosed to clients.


We look primarily for great companies selling at reasonable prices and some good companies selling for cheap prices. Occasionally, in times of extreme market duress we can find great companies selling for cheap prices. One of the many things that we look for is a company with a low PEG ratio. If we can find a company with a growth rate equal to or higher than its PE, then that is a nice starting point. We also look for companies with a low PE relative to its historical PE and a low PE relative to the market multiple. Other things that we look for are companies with sustainable earnings growth, high return on equity, strong free cash flow, a stock buy back program and a clean balance sheet. A company that has a safe dividend is a bonus. A company’s management is very important. We also look for companies with a competitive advantage. With our strict criteria, it is sometimes difficult finding 25 companies to own at the price that we want to own them. While a company’s market cap is not relevant, we lean towards large cap companies.

Mutual fund philosophy

One of the reasons we feel comfortable with a philosophy of having a concentrated stock portfolio is that we diversify our client’s holdings with the mutual funds. This way our clients get the best of both worlds. All of our mutual funds are no load funds. They are all followed by Morningstar. We invest in a variety of value and growth funds that range the full spectrum of market caps although we tend to favor large cap. Similar to our managed stock accounts, we tend to favor funds that give their managers the leeway to go anywhere as far as market caps rather than stick to strict style boxes.

Fixed income philosophy

We acknowledge that we specialize in equity management. Most of our clients come to us to grow their assets over a long period of time. For those that need fixed income, we invest in both no load bond funds as well as individual bonds. For the bond funds, we do invest in some of the more well known names.  Depending on the amount of assets, we lean towards funds that have bonds with a longer duration with higher yield. We also will invest in two funds with intermediate durations.

For clients who prefer individual bonds, we purchase for them both taxable and tax free bonds.