Our Philosophy & Approach
Our investment philosophy is directed by the needs and objectives of our clients. Gaining complete understanding of these is crucial to implementing a successful investment strategy. Further, we believe each account is unique and its investments should reflect that individuality.
We hold ourselves to high standards and values of prudence and quality. Through diversification and asset allocation strategies we seek to minimize our clients’ exposure to unnecessary risk.
To translate our philosophy into a workable investment approach, Trust Company of Vermont’s managers employ the following techniques:
- We utilize top-down analysis of the economy and investment alternatives.
- Selection of securities must meet consistent quality and valuation standards.
- Equities are selected and purchased based on each company’s value relative to their earnings, revenue and cash flow. Quality of earnings and consistency of returns on equity and income growth are some of the factors used to select stocks. Equities become candidates for sale when there is a breakdown in the company’s fundamentals or when it falls outside of our valuation standard.
- Weighting economic sectors is an important part of our investment management process and these are monitored and adjusted on an ongoing basis.
- We incorporate client-specific environmental, social and governance priorities when desired.
- Bonds are selected based on the credit quality of the issuer, duration, yield spread and clients’ tax-based needs.
The Trust Investment Committee (TIC), comprised of all our investment managers, is responsible for the development of our economic projections, asset allocation targets, bond portfolio structure and the maintenance of our approved securities list. Within guidelines created by TIC and with peer oversight, each manager invests their clients’ accounts to meet specific account objectives.