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Our Main Investment Goal is Conservative Growth Coupled with Preservation of Capital

Investment Philosophy and Principles

At Bennicas & Associates, Inc. our guiding principle is that our clients don't need to take on excessive risk in order to achieve their goals.  Instead, they need to minimize mistakes and methodically compound over market cycles.  Institutional investors such as pensions and endowments call this "liability driven investing", which is matching the risk taken by the portfolio to the shorter term cash flow and longer term growth needs. We call it common sense.  

 

Methodically compounding requires declining less than broad markets during bear markets, and more or less keeping up during bull markets.  Chasing the growth stock du jour, or wringing out every penny of a bull cycle might work for some, but not for us. We will buy "great businesses" and hold them for long periods. We will counter balance equity risk by owning higher yielding instruments such as bonds and alternative investments.  We have been concerned about our clients buying power as the US dollar faces myriad challenges.  Our investment strategy addresses this risk as well.  

 

Except for special situations, and unlike most wealth counselors, we do not place our client assets in third-party managed accounts.  Rather we focus our efforts on identifying attractively priced companies, both domestic and international, that are profitable and have high levels of free cash flow.  We favor companies with specialized niches, strong market positions, and whose management teams make smart decisions about the company's cash flow.  Learn more about what we consider to be "great businesses" here.  

Investment Process

Our investment process begins with the use of a proprietary, quantitative multi-factor model that screens the universe of stocks.  We are seeking to identify companies that are relatively attractive versus industry peers, have higher-than-peer levels of free cash flow, and strong balance sheets.  This combination of factors is what we consider to be "quality value", and is the cornerstone of our philosophy.  Day in and out, Bennicas & Associates employs this time-tested, consistent approach as we have done since 1989.

 

Generally, portfolios are balanced within a range of 40%-60% equities, and the balance in bonds, liquid alternative investments, cash, and inflation hedges such as precious and industrial metals.  

 

The Bennicas & Associates investment team constantly evaluates macroeconomic factors to inform our portfolio positioning and risk taking.  Central bank liquidity operations, government fiscal and tax policies represent massive influence that we consider with each investment choice that we make.  There is simply no way to inure an equity mostly portfolio from risk. But the quality value balanced approach employed by Bennicas & Associates has stood the test of time for over 30 years, with the ultimate objective of helping our clients achieve their long-term financial goals. 

It's the combination of qualitative and quantitative analysis that protects and grows a portfolio.