Account Details

In our separately managed core equity accounts, clients own a portfolio of securities. For these accounts we are able to customize each portfolio based on individual needs such as equity exposure levels, legacy positions, specific investment restrictions, income needs, etc. that may not be met by a mutual fund.

Performance

Core Equity Composite (as of 6/30/17)

In our Core Equity accounts Osterweis has the discretion to decrease or increase equity exposure in an effort to reduce risk.

  QTD YTD 1 YEAR 3 YEAR 5 YEAR 7 YEAR 10 YEAR 15 YEAR 20 YEAR SINCE INCEPTION
(1/1/1993)
Core Equity Composite (gross) 2.52% 8.08% 13.24% 3.27% 11.60% 11.23% 6.51% 9.62% 10.34% 11.45%
Core Equity Composite (net) 2.27 7.58 12.19 2.24 10.48 10.13 5.43 8.50 9.19 10.29
S&P 500 Index 3.09 9.34 17.90 9.61 14.63 15.41 7.18 8.35 7.16 9.42
Core Equity Composite (gross) Core Equity Composite (net) S&P 500 Index
QTD 2.52% 2.27% 3.09%
YTD 8.08 7.58 9.34
1 YEAR 13.24 12.19 17.90
3 YEAR 3.27 2.24 9.61
5 YEAR 11.60 10.48 14.63
7 YEAR 11.23 10.13 15.41
10 YEAR 6.51 5.43 7.18
15 YEAR 9.62 8.50 8.35
20 YEAR 10.34 9.19 7.16
SINCE INCEPTION
(1/1/1993)
11.45 10.29 9.42

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Core Equity Fully Invested Composite (as of 6/30/17)

Core Equity Fully Invested accounts normally remain close to 95% invested in equity securities, except in times of unusual market stress when a more defensive allocation may be deemed prudent.

  QTD YTD 1 YEAR 3 YEAR 5 YEAR 7 YEAR 10 YEAR 15 YEAR 20 YEAR SINCE INCEPTION
(1/1/1993)
Core Equity Fully Invested Composite (gross) 2.56% 8.23% 14.36% 3.40% 11.95% 11.47% 6.69% 10.27% 11.30% 12.21%
Core Equity Fully Invested Composite (net) 2.26 7.55 13.21 2.49 10.99 10.47 5.67 9.27 10.25 11.13
S&P 500 Index 3.09 9.34 17.90 9.61 14.63 15.41 7.18 8.35 7.16 9.42
Core Equity Fully Invested Composite (gross) Core Equity Fully Invested Composite (net) S&P 500 Index
QTD 2.56% 2.26% 3.09%
YTD 8.23 7.55 9.34
1 YEAR 14.36 13.21 17.90
3 YEAR 3.40 2.49 9.61
5 YEAR 11.95 10.99 14.63
7 YEAR 11.47 10.47 15.41
10 YEAR 6.69 5.67 7.18
15 YEAR 10.27 9.27 8.35
20 YEAR 11.30 10.25 7.16
SINCE INCEPTION
(1/1/1993)
12.21 11.13 9.42

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Philosophy

We employ a risk-averse investment strategy predicated on the belief that strong long-term investment results are best achieved through a compounding of reasonable gains and the avoidance of major losses. We, therefore, consciously strive to limit downside exposure as much as to generate upside returns.

We focus on out-of-favor, undervalued situations with low P/E, P/B and P/FCF ratios and strong or rapidly improving cash flow dynamics. We seek to avoid fads and speculatively priced stocks, where the risk of mistakes is high.

We continually search for under-researched, growth situations that can be purchased for modest multiples. As such companies gain recognition and are accorded multiples more in line with their growth rates, we may become sellers. We also tend to focus on asset rich companies with improving earning prospects. In short we often follow the old saying, “Buy assets, sell earnings.” This tends to reduce the risk of earnings disappointments.

Underlying everything we do is an intense focus on cash flow, especially a company’s ability to generate free cash flow after all expenses and capital spending. Cash flow is more real than reported earnings, which are subject to accounting manipulation. Companies that generate strong free cash flow are able to repay debt, repurchase shares, and grow through acquisitions or reinvestment in their businesses. They are also attractive acquisition targets for both other companies and financial buyers. Because of these characteristics, companies with rising free cash flow are often better able to grow, regardless of stock market conditions and, at the same time, may offer downside protection during periods of market weakness.

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Past performance is not a guarantee of future results.

Rates of return for periods greater than one year are annualized. The information given for these composites is historic and should not be taken as an indication of future performance. Performance returns are presented both before and after the deduction of advisory fees. Account returns are calculated monthly, using a time weighted return method. Account returns reflect the reinvestment of dividends and other income and the deduction of brokerage fees and other commissions, if any, but do not reflect the deduction of certain other expenses such as custodial fees. Monthly composite returns are calculated by weighting account returns by beginning market value. Net returns reflect the deduction of actual advisory fees.

The Standard & Poor’s 500 Index (“S&P 500”) is an unmanaged index and is widely regarded as the standard for measuring U.S. stock market performance. This index does not incur expenses and is not available for investment. Index returns reflect the reinvestment of dividends. The S&P 500 Index data are provided for comparison of the composite’s performance to the performance of the stock market in general. The S&P 500 Index performance is not, however, directly comparable to the composites’ performance because accounts in the composites generally invest by using a portfolio of 30-40 stocks and the S&P 500 Index is an unmanaged index that is widely regarded as the standard for measuring U.S. stock market performance.

The fee schedule is as follows: 1.25% on the first $10 million, 1.00% on the next $15 million up to $25 million, and 0.75% in excess of $25 million. A discounted rate is available for tax-free institutions, eleemosynary accounts and large institutions.

Clients invested in separately managed core equity accounts are subject to various risks including potential loss of principal, general market risk, small and medium-sized company risk, foreign securities and emerging markets risk and default risk. For a complete discussion of the risks involved, please see our Form ADV Brochure and refer to Item 8.

The Core Equity Composite includes all fee-paying separately managed accounts that are predominantly invested in equity securities, and for which OCM has the discretion to increase and decrease equity exposure in an effort to reduce risk. The non-equity portion of the account may be invested in cash equivalents, fixed income securities, or mutual funds. Individual account performance will vary from the composite performance due to differences in individual holdings, cash flows, etc.

The Core Equity Fully Invested Composite includes all fee-paying separately managed accounts that are predominantly invested in equity securities. OCM has discretion over individual investments but does not normally exercise asset class allocation discretion in these accounts. Accounts normally remain close to 95% invested in equity securities, except in times of unusual market stress when a more defensive allocation may be deemed prudent. Individual account performance will vary from the composite performance due to differences in individual holdings, cash flows, etc.

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