Tandem Capital Management works closely with our clients in developing customized investment portfolios. Each client account is held and managed separately. The process begins with a thorough understanding of a client’s financial situation, risk profile, income needs, tax situation and time horizons. In managing core client portfolios, the firm seeks to balance above-average investment results with moderate risk.
In equities, Tandem Capital Management takes a long-term, value-oriented approach for its core portfolios. We begin with a top-down look at markets and key economic sectors. Then, with an eye towards promising industry themes and an emphasis on corporate free-cash-flow, we select investments based on bottom-up fundamentals. We look for companies with competitive advantages and sustainable profit margins. We also favor industry sectors where the competitive market structure or secular industry demand might be changing. We believe this growth-at-a-reasonable-price approach along with substantial diversification produces portfolios that are durable with generally low, tax-efficient portfolio turnover. We are not market timers and avoid wholesale rushes into and out of financial markets. Similarly, clients depend on us to avoid the investment fashion of the day and to be prudent judges of valuations, risk and growth potential. The fundamental research we do on industry sectors and individual companies, as well as our top-down investment view, also informs our selection of mutual funds and exchange-traded funds (ETFs), which we use to further expand portfolio exposures or exploit narrower, but inexpensive, sectors.
In fixed income, we focus predominantly on investment-grade issues (both taxable and tax-exempt) in core portfolios. Our approach is mostly defensive and emphasizes fixed maturities with average maturities closely matched to client objectives. Core portfolios are diversified by issuer and may be augmented by mutual funds, ETFs, and other instruments where broader exposure or greater current income is needed.