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Investment Team:
David Ruff, CFA, CIO view profile
Bruce Brewington, Portfolio Manager, Analyst view profile
Randall Coleman, CFA, Portfolio Manager, Analyst view profile
Investment Philosopy
Berkeley believes that by emphasizing higher-yielding stocks, Global Dividend can participate in stock market advances, and protect capital better than alternative strategies during stock market declines. By actively targeting 20-30% lower volatility, as measured by standard deviation and beta, the portfolio can lower risk compared to strategies that focus solely on returns. The defensive quality of the portfolio, and its ability to outperform equity markets during periods of weakness, provides for potentially superior performance over full market cycles.
Description
Berkeley's Global Dividend strategy seeks to provide long-term capital appreciation and dividend income by investing in larger, established companies located all over the world. The portfolio invests primarily in blue-chip common stocks or ADRs that regularly pay dividends. Investments are selected based on higher relative dividend yields, dividend growth potential, and anticipated stock price appreciation. This globally oriented portfolio is typically structured with 40 to 50 stocks, diversified across 7 to 10 sectors. Geographically, the portfolio is diversified across five or more countries with the U.S. usually receiving the largest allocation.
Investment Process
Buy Discipline
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Quantitatively screen companies in the MSCI World and select high quality, emerging market companies, with an absolute dividend yield higher than their local market or S&P 500. |
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Quantitatively screen for companies with an unusually high historical relative yield. This can be defined as being 1 standard deviation above its historical average. This unusually high historical relative yield acts as an indicator to identify companies that may be undervalued. |
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Qualitatively research the most attractive names in the resulting universe, and set a target valuation. This step includes the fundamental analysis of the company’s industry, management, growth strategy and financial statements. |
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Determine weighting based on the perceived risk, and strength of the investment catalysts. |
Sell Discipline
A security may be sold for any of the following reasons:
- A stock’s yield falls at least one standard deviation below its historical relative yield (This is the inverse of our buy discipline)
- A stock’s yield declines to an unattractive level
- A stock’s dividend is unlikely to be maintained
- Future stock price appreciation appears limited
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