Our focus is on building and managing portfolios of growth-oriented equities, using fixed income and other asset classes for balance and stability. For asset classes outside of U.S. equities and bonds, such as international, private equity or real estate, we consider other investment vehicles including limited partnerships, exchange-traded funds and mutual funds.
In addition to managing portfolios, each portfolio manager at The Boston Family Office is responsible for following a sector of the economy. Primary sources as well as various research providers are used to generate new investment ideas. In addition, there is a formal presentation to the Investment Committee on each sector at least three times a year. Other topics addressed by the Investment Committee are quarterly reports on the economy, updates on the institutional investment landscape and monthly activity reports from each portfolio manager. Portfolio managers independently determine the appropriateness of particular investments relative to each client’s specific needs and existing assets, and implement these ideas.
Investments in Equities
We look to make equity investments in quality companies that can be held for several years or more. We focus on companies that are benefiting from favorable macro economic trends, have strong product or service franchises, and have good management teams. Diversification is maintained by limiting sector weightings and size of individual holdings.
Investments in Fixed Income
Investments in fixed income will be taxable or non-taxable depending on the client’s needs. Creditworthiness of the issuer (in general A- rating or better), the number of years until maturity (rarely more than 12 years), and the coupon rate are the most important considerations. In general, we build a “ladder” of bonds, with maturities stretched over a period of years.
Other Asset Classes
For areas outside of our expertise such as international investing, real estate and private equity, we will use outside managers, through investment vehicles ranging from exchange-traded funds to mutual funds and limited partnerships.
While we expect to realize capital gains in portfolios, considerable attention is paid to keeping taxable net realized gain within a client’s tolerance level, ensuring that the amount of tax due does not come as a surprise. Nonetheless, we try not to have tax consequences dominate the investment decisions.
Our Investment Committee includes all portfolio managers and additionally calls on the insights of analysts and other experienced investment professionals.