Investment Strategies

Proprietary Research - The Key to our Investment Success

The professionals of James Investment Research, Inc, are, above all else, risk managers. We understand that preservation of capital and long-term growth are critical to our clients.

That's why we use strategic asset allocation techniques to create balanced portfolios custom-tailored to meet each individual's investment needs and risk tolerance. Our active management style bases asset allocation on our proprietary market risk indicators. These indicators help us assess the general risk levels in the stock and bond markets.

We review them every week in the form of written market appraisals, a long-time James tradition. Our appraisals give us a clearer picture of the market's long, intermediate and short-term risks. Armed with this knowledge, we adjust either the stock, bond or cash allocation of a balanced portfolio toward the area offering the least risk and the greatest potential reward.

Since we do most of our research in-house, we have been able to create a unique top-down approach to generating wealth for our clients. What begins with a broad investigation of overall economic trends such as interest rates and inflation, funnels down to an in-depth market risk assessment. After this, we make an allocation decision. Next, we actively manage the equity and fixed-income portions of the portfolio. This is how we strive to maximize return, while minimizing risk.

James Strategic Asset Allocation Process

James seeks to add value at every level of the portfolio management process. This means we take an active management approach not only to equities in a balanced portfolio, but to the bonds as well. Our fixed income investment philosophy is centered on preserving capital through interest rate anticipation and active duration management. Our market risk indicators help us to assess the direction of interest rates and to identify periods of risk in the fixed income markets. We then target a portfolio duration according to individual risk tolerance. You won't find "exotics","high risk derivatives" or junk bonds in James-managed portfolios. Instead, we focus on high-quality bonds, insured municipal bonds, convertible bonds, U.S. Government Agency bonds and other high quality investments. Sticking with these more conservative types of bonds means the portfolio will offer excellent liquidity.

Proprietary Research - The Key to our Investment Success

At James Investment Research, we manage our clients' portfolios with resources nobody else has. Our research team has validated every step in our top-down approach to stock selection. Just as with the management of balanced portfolios, we begin by assessing our market risk indicators to identify which sectors of the equity market are likely to outperform. Then, our sector analysts go to work using fundamental and technical analysis, to search for top equity prospects. Only after final approval by our investment committee can a stock be added to the firm's "buy" list.

Top DownOur proprietary stock ranking model is a tremendous tool in our equity research process. For over a decade it has been providing impressive discrimination between potential winners and losers in the stock market. Our database allows us to track and sift through over 8,000 stocks, identifying those that meet our specific investment criteria.

We review over 200 factors on a given company. James' Equity Portfolios represent a strategic blend of equities and cash equivalents, with the ongoing allocation determined by our appraisal of the overall risk level in the equity market. Our portfolios typically carry a blend of both large and small capitalization stocks, with allocations weighted towards the sectors representing the most opportunities.

Our research has proven the sell decision is often more important than the buy decision. Therefore, if a stock has deteriorated in ranking, relative strength, or if one of our senior analysts detects a problem with the stock, it is immediately reviewed by our investment committee. If the committee makes the decision to sell, the actual sale is methodical. We track stock positions daily and attempt to sell into a rally when possible.