Our investment philosophy is simple: preserve our clients' wealth. Our "defensive" style of management that supports this philosophy is equally straightforward: actively manage all holdings to maximize total return (on an after tax basis.)Our "traditional styled" portfolios can be typically characterized as follows:
Avg. Effective Maturity 5.0 years
Avg. Effective Duration 4.5 years
Avg. Quality AA+** Nothing less than "A" rated.
The benchmark used to gauge performance in our Traditional 5 Year Strategy is the Lehman Brothers Five Year General Obligation (GO) Index.
The following graphs illustrate the composition of C.W. Henderson & Associates total portfolio. The first graph illustrates the portfolio composition based on the types of bonds held, the second shows the composition by credit rating and the third shows the ratio of insured to uninsured bonds.
Graphs updated as of 3/31/08
C.W. Henderson & Associates utilizes AxysTM Portfolio Management Software, developed by Advent Software, Inc. to manage and monitor client portfolios. AxysTM gives us the technical ability to analyze client portfolios and deliver superior client service by:1. Accessing portfolio holdings and current cash balances on an as needed basis;
2. Receiving electronic confirmation of trades;
3. Running a variety of management, portfolio and performance reports with flexible formatting.
From March 1991 to March 2008 the total return of our Traditional Strategy Composite was 5.48%, net of fees (using the maximum fee level), on an annualized basis, versus 5.49% annualized for the Lehman Brothers Five Year GO Municipal Index.
We do our best work for clients, on a relative basis, when interest rates are rising and the "yield curve" is flattening. We are most proud of our investment returns in 1994 which was one of the worst years in the history of the municipal bond market. In 1994, C.W. Henderson & Associates' traditional strategy composite returned 0.56%, net of fees, on a total return basis, versus negative 1.38 % on the Lehman Brothers Five Year GO Index.
Note: Past performance is not a guarantee of future results.
Graph updated as of 3/31/08
1. Traditional Strategy Composite performance calculated net of maximum fee.
2. Unlike the CWH Traditional Strategy, the Lehman Brothers 5 Year General Obligation Index is not actively managed, so the Index returns do not take into account any management fees. If management fees were applied to the Index returns as they are to the CWH Traditional Strategy returns, the Index returns would have been lowered.
3. Performance results reflect the reinvestment of dividend and other income.
4. Rapid and dramatic inflationary market conditions would probably have a negative impact on investment results.
5. As with any investment vehicle, there is a possibility of loss as well as potential for profit.
6. CWH's portfolio contains higher quality municipal bonds compared to the Lehman Brothers Five Year GO Index.
Note: Approximately 4% of the Lehman Brothers Five Year GO Index is comprised of bonds rated Baa/Non-Rated or below investment grade, whereas C.W. Henderson & Associates, Inc. has only a small fraction of 1% of assets invested in bonds rates less than single A.
