Investment Strategies
Middleton & Company has a framework of four investment strategies. We use these to build portfolios in the context of a client’s existing holdings and their current objectives. For each client, a specific strategy, or a combination of strategies, may be appropriate.
Core Equity
A Middleton Core Equity portfolio has a well diversified, growth-oriented focus and is designed to generate annual returns in excess of the S&P 500 over a multi-year time horizon. The portfolio typically consists of 40-50 holdings diversified across economic sectors, with an emphasis on high-quality companies, which generate consistent, double-digit annual earnings growth. The portfolio may also incorporate the use of Exchange Traded Funds (ETFs) to efficiently access markets or sectors that appear to be attractively valued. Annual turnover is targeted at less than 25%, making this portfolio appropriate for investors sensitive to capital gains taxes.
Capital Appreciation
A Capital Appreciation portfolio is designed to pursue aggressive capital growth for clients with a higher tolerance for risk and less sensitivity to capital gains taxes. This is a concentrated portfolio that will typically hold 20 to 25 positions, with less emphasis on sector diversification. The focus of these investments is rapid earnings growth or near-term stock appreciation catalysts.
Equity Income
An Equity Income portfolio is designed to provide equity exposure to clients who desire above-market income generation, with moderate risk tolerance. Emphasis is placed on companies with solid dividend yields and a history of consistent dividend increases. The portfolio typically consists of 30-35 holdings and is managed in a tax-sensitive manner. Turnover is targeted at below 20% per year.
Fixed Income
Middleton & Company’s bond portfolios invest in high quality fixed income instruments. Portfolio maturity and duration will be actively managed to take advantage of the outlook for the yield curve and relative valuation opportunities.
United States Treasury bonds, Municipal bonds, and high quality Corporate bonds may be emphasized, depending upon relative spreads in the marketplace and a client’s individual tax situation.