Our Investment Strategy
Covenant Trust Company® provides trustee services and asset management for individuals and organizations nationwide, with approximately $700 million in client assets currently under management.
We utilize a disciplined and diversified investment approach that is strategic rather than tactical. We design our strategies to be successful over time periods that encompass full market cycles. For most clients, investment time horizons are measured in terms of years, not weeks or months.
Asset allocation is the foundation of our investment approach. Each portfolio is designed to balance risk and expected return and invested according to the investor’s risk tolerance, needs, goals, and investment time horizon. Asset allocations are globally diverse in terms of asset class, market sector and geographic exposure. Strategies generally are based upon an intermediate to long-term time horizon, and may incorporate gradual adjustments over time. We do not shift our allocation targets based on short-term movements in markets. We do not attempt to time the markets or pick stocks.
- Act with Integrity and excellence.
- Act as a Fiduciary, putting client’s best interests first.
- Understand client needs and goals.
- Option to invest in a socially responsible manner.
- Asset allocation remains the single most important decision in portfolio construction.
- Diversification both across and within asset classes is essential.
- Passive strategies are used where advantageous and active management strategies will be considered when greater risk-adjusted returns can be achieved.
- Client risk tolerance is defined by both objective and subjective factors, is dynamic and may change over time.
- A spectrum of portfolios based on expected risk and return can be created which, in turn, can be properly matched to the client’s needs and risk tolerance.
- All investing involves risk. Greater risk is associated with higher returns over longer time periods.
- Investment costs are a critical component in determining long-term results.
- Prudent investment management with a long-term perspective is essential.
- Capital markets are generally efficient over the long term.
- Portfolio strategies, although long-term oriented, are modeled and tested regularly.
- Regular rebalancing of individual portfolios is important to maintain the intended risk level.
For more information about our investment strategy and services, please contact us.