Philosophy: Common Stock

The distinguishing characteristic of Wallington Asset Management’s equity philosophy is the employment of both value and growth stocks in constructing equity portfolios.

Wallington Asset Management employs both value and growth stock philosophies in the construction and management of equity portfolios. This blended investment philosophy toward common stocks originates from the ongoing debate between value and growth stock adherents and the inordinate amount of risk incurred when either value or growth selection is used exclusively. We believe that simultaneous investment in both value and growth stocks results in enhanced performance and serves to reduce the risk of under-performance associated with a stock portfolio exposed solely to the characteristics of either growth stocks or value stocks.

Our strategy is to select stocks of companies in those instances where we believe the market is underestimating the total return potential from holding such a security. Conversely, we eliminate those securities we believe are priced at a level reflecting unrealistic expectations. Each client’s equity portfolio maintains diversification but not in strict accordance with the sector weights reflected in the popular indexes. It is our ultimate objective to preserve capital and to outperform the market on a risk-adjusted basis over the long-term utilizing the S&P 500 Stock Index as the benchmark portfolio against which performance will be measured.


Photo: Scalini