Investment Process

Caywood-Scholl’s rigorous research process begins with a macroeconomic analysis to identify favorably situated industries. Analysts then perform detailed credit research on individual issues within these industries to identify those companies which offer the most compelling risk/return tradeoff. Every company we own or consider for purchase is thoroughly analyzed in a detailed research report. A highlight of this report is our proprietary Credit Scoring Model which is used by the portfolio management team to spot relative value opportunities within industries as well as across rating categories. Once in our client portfolios, credits are continuously monitored to ensure that the rationale for owning them is still valid. Holdings are sold if: 1) an industry’s outlook deteriorates, 2) a company’s results underperform our analyst’s projections, 3) there is an unexplained or fundamental reason for an extreme drop in the company’s stock, and 4) price appreciation occurs and the funds are redeployed elsewhere.