Can Individual Investors Benefit from a Religious Institutional Investment Manager? An Interview with Norman B. Conley III, the Chief Executive Officer and Chief Investment Officer of JAG Capital Management

Wall Street Transcript

67 WALL STREET, New York - November 13, 2013 - The Wall Street Transcript has just published its Investing Strategies Report. This special feature contains expert investing commentary through in-depth interviews with highly experienced Money Managers. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

Topics covered: Large-Cap, Deep-Value - Disciplined Growth Approach - Bottom-Up Stock Selection - Investing in Financial Services - Index-Only Investing - Corporate Restructuring - Repurchase Activity - Tax-Efficient Investing

Companies include: Starbucks Corp. (SBUX), Google Inc. (GOOG), NCR Corp. (NCR), Diebold Inc. (DBD), Herbalife Ltd. (HLF) and many others.

In the following excerpt from the current Investing Strategies Report, an experienced portfolio manager discusses the methodology for investing without the use of portfolio companies active in marketing tobacco, liquor, gambling, weapons of mass destruction or who have poor labor relations or pollution control policies:

TWST: Tell us about JAG Capital Management.

Mr. Conley: Our firm's roots go back to 1945. Our parent company was founded as a broker/dealer, and for many years we operated as a dually registered firm. In May of 2013, we concluded a corporate reorganization that separated our brokerage and advisory operations into two separate legal entities.

Our investment management business is named JAG Capital Management, LLC. We have approximately $1.1 billion in assets under management; roughly $400 million of that total is invested in our large-cap growth managed equity strategy. Most of the remaining $700 million is invested in our fixed-income strategies. The vast majority of our managed assets are invested in separate accounts for institutions and individuals, but we also manage an open-ended mutual fund called the JAG Large Cap Growth Fund. We launched the fund in December 2011, and it has approximately $22 million of assets.

TWST: How have your investment philosophy and the company evolved over time?

Mr. Conley: Interestingly, all of our strategies were developed over the decades to address the long-term challenges of religious institutional clients. Specifically, how do institutions fund their long-term missions and organizational goals over what will hopefully be a perpetual time frame? Accomplishing these objectives requires generating cash flow to fund current operations, combined with long-term growth of capital to fund future needs. Our core investment philosophy and all of our investment strategies were developed to address these objectives.

Our bond strategies seek to deliver long-term capital preservation, diversification and cash flow for our clients. Our large-cap growth strategy seeks to generate long-term growth of capital in excess of inflation. And all of our strategies embrace a focused portfolio structure by holding only 30 to 40 securities at all times. I should say right up front that we are unapologetically active managers. We think that properly constructed and intelligently managed securities portfolios can outperform passive indexes.

In each of our strategies, we're aiming to outperform our relevant benchmarks over rolling three- to five-year periods and beyond. In order to deliver outperformance, we have to be able to structure our holdings differently than the index...

For more of this interview and many others visit the Wall Street Transcript - a unique service for investors and industry researchers - providing fresh commentary and insight through verbatim interviews with CEOs, portfolio managers and research analysts. This special issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

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