This strategy aims to provide exposure to US. domestic markets via companies based in one of the most business friendly states: Texas. In addition to having a GDP that dwarfs many countries (The Economist has compared the size of the Texas GOP to that of Russia's - Economist.com), Texas has been highly ranked by Forbes' "The Best States For Business And Careers” (Forbes.com) as well as CNBC’s "America's Top States for Business" (CNBC.com).
We look to capitalize on discounts to fair value, while taking advantage of a large economy and business friendly government.
Adding companies from Texas can help strengthen an investor’s entire portfolio in several ways. They provide overall diversification to U.S. domestic equity given the broad array of industries in Texas. The business results of companies that operate in such a large economy are partially buffered from issues faced by the U.S. economy at large, such as unemployment and tightened credit, because the firms have the size to adjust on a smaller economic scale, but a large enough scale to make a difference. Additionally, operating in a business friendly government environment helps foster growth because of the low tax burden.
A Morningstar screen identifies companies that are based in Texas, traded on United States stock exchanges, and sell at a discount to fair value. Additional research is performed using publicly available information (e.g., financial statements, prospectuses) to determine company strength and stability. Other factors, such as the macroeconomic environment and government regulation, are also considered before a purchase is made.
The model will have up to 10 holdings with each having a weighting of no more than approximately 15% of the model. This model may hold cash as it waits for opportunities.
Selling occurs when a holding hits a predetermined target price, develops problems with its operations, or can be replaced by a more attractively valued holding.
Past performance is no guarantee of future results.
Performance of the Portfolio Manager's account is calculated by Covestor on a daily time-weighted basis, including cash, dividends and earnings distributions and broker commissions. Manager returns include trades and positions that fail Covestor's trading rules, as a result, actual client returns will differ. Covestor advisory fees are simulated and applied retro-actively to present the portfolio return "net-of-fees".
Average client returns are calculated by Covestor and are composed of the asset-weighted average returns of all active client investments (some of which may contain investment restrictions) to the underlying portfolio. These daily average returns are then linked together for the timeframe presented. These returns include cash, dividends, earnings distributions, brokerage commissions and Covestor advisory fees.
All graph data is as of the end of day for the referenced period, unless otherwise specified. The investment minimum is the minimum investment required to follow a particular portfolio. The minimum amount is determined by Covestor, based on the characteristics of the underlying portfolio. It should not be considered as specific investment advice for your investment situation.
The performance charts are provided for informational purposes only, and should not be used as the basis for making an investment decision. Variables such as corporate actions or foreign exchange may affect daily performance displays. We rely on mathematical formulas, computer programs, and pricing information from third-party vendors to provide these returns. Neither Covestor nor any of its data or content providers shall be liable for any errors in this information or any actions taken by you in reliance upon this information.
Benchmark returns have been calculated by Covestor using a time-weighted calculation of daily index valuations.
Leverage indicates the level of margin utilized and is calculated by dividing gross exposure by portfolio net liquidation value.
All Portfolio Manager information including personal data, profiles, strategies, monthly investment reports, and historical results outside of Covestor has been provided by the Portfolio Manager. Covestor makes no representation or warranty of its accuracy, completeness or relevance and it does not represent the opinions of Covestor. Transaction history is available upon request. Portfolio classifications are provided by Covestor, and are intended to serve as a general guide.
Not all transactions listed will appear in your account due to Covestor's trading rules and individual client constraints. Eligibility of these securities is monitored periodically, and may change over time. Actual client investment holdings may vary.
Index returns do not reflect any management fees, transaction costs or expenses. Individuals cannot invest directly in an Index. For certain portfolios we use an investable ETF as a benchmark, in these cases returns include management fees, transaction costs and expenses.