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February 19, 2013 at 08:31 AM
KeatsConnelly specializes in advising cross-border clients, so it’s only natural that international investing should be a part of their clients’ portfolios.
Chief Investment Officer Peter Eickelberg (left) said that the firm not only invests internationally, but “follows the abundant academic evidence that managers can’t beat the market by picking stocks.”
The firm relies on funds that passively purchase, but at the same time it doesn’t “buy everything at market weight,” he said. Instead, it considers a number of factors when making its decisions.
The investing strategy is to “look at decades of performance and boil down returns to [several] factors: what [investments] have returned and what cash has returned,” Eickelberg said. Value stocks “have tended to provide a certain amount of return, and smaller companies have produced more than large,” he said, adding that this doesn’t hold true for every stock and every market.
The international focus has been part of the firm’s approach for “as long as I’ve been here and for many years before that,” he said. “I started in 2006. [International investing at KeatsConnelly goes] all the way back to inception, probably, but at least the last 10 to 15 years.
“It’s basic thinking. The world is big place; the U.S. is probably about 45% of the world’s publicly traded equity markets, and that leaves 55% somewhere else. Why would we assume the U.S. is the best place?” Eickelberg said.
Of course, it is the country he knows best. “Unfamiliarity keeps people away,” he said.
