Investment Strategies

Marathon Strategic Advisors employs a hybrid approach to investing. We invest in both growth and value opportunities, with an emphasis on value. Our goal is to maximize returns throughout the market cycle by investing in our “best ideas.” Marathon uses a “top-down bottom-up” approach to selecting securities. We first define the global economic outlook, particularly interest rate anticipation, and then concentrate on investments in specific industries. Investments are made with a long-term orientation, generally involving the purchase of securities held for at least a year. This results in relatively low portfolio turnover that minimizes the tax consequences for investors. We avoid high-flying stocks that sell for a premium to their relative fundamental value. Additionally, we do not attempt to time the market. Thus, portfolios are fully invested, and typically contain 20-35 issues. Value is seen in both relative and absolute terms. Therefore, securities appearing overpriced relative to their intrinsic value and other investment opportunities are sold. The following investment strategies are utilized by Marathon in the management of equity, fixed income, real estate, and alternative investments.

Security Selections
May Be Influenced By:

Growth rate/price earnings comparisons

P/E ratios versus historical and current levels

Under-researched companies

EBITA multiple comparisons

Macroeconomic factors

Marathon does not have a “magic black box” or secret “foolproof system” toward selecting individual investments. We believe the best way to evaluate an investment opportunity is through intensive research. We research individual securities using a large variety of informational sources that may include the following: Marathon’s own fundamental analysis, direct communications with the company’s management team, product research, review of outside analyst research, and the study of financial publications. Marathon believes that these sources, combined with our investment experience, will enable us to position our clients’ assets such that they may benefit from the long-term changes in the markets. (However, as is the case with all investments, no assurances can ever be made that this or any such an investment strategy will succeed.)

Portfolio Construction

When constructing portfolios, our strategy is to employ modern portfolio theory and asset allocation techniques designed to help accomplish the client’s goals. Also, our strategy is to offer the best service possible on a cost efficient basis.

The asset allocation of an investment portfolio determines the risk level and ultimately the investment return. Thus, the allocation of a portfolio should be based on the investor’s goals and objectives. Marathon develops portfolios that help our clients achieve the returns necessary to accomplish their goals while presenting risk expectations that are understood and acceptable.

Efficient Frontier

Marathon will assess your unique tolerances for risk, return objectives, needs, and personal financial situation to help you determine the optimal portfolio that meets your long-term investment goals. Our goal is to structure your portfolio so that you receive the best (optimal) return for the amount of risk you choose to assume.

Asset Allocation accounts for 91% Portfolio Variation

Source: Brinson, Gary P. et al. “Determinants of Portfolio Performance,” Financial Analysts Journal, July/August 1986. Updated in Financial Analysts Journal, May/June 1991.

Diversification Among
Multiple Asset Classes

We believe that asset allocation is the most reliable risk control for portfolios.

All client portfolios should be invested in multiple asset classes in order to achieve the best investment returns for a given level of risk.