A Strategy for Being Fully Invested in Stocks: A Wall Street Transcript Interview with Stuart Brown, Chief Investment Strategist and Portfolio Manager at Warren Capital Group

Wall Street Transcript

67 WALL STREET, New York - May 21, 2013 - The Wall Street Transcript has just published its Investing Strategies Report offering a timely review of the sector to serious investors and industry executives. This special feature contains expert industry commentary through in-depth interviews with Money Managers. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

Topics covered: Investing in Financial Services - Long-Term Investing - Large Cap Investing - Value Investing - High Quality Companies - Bottom-up Investing - All-Cap Growth Investing - Investing in Emerging Markets

Companies include: GameStop Corp. (GME), Time Warner Inc. (TWX), Sinclair Broadcast Group Inc. (SBGI) and many more.

In the following excerpt from the Investing Strategies Report, an experienced portfolio manager discusses his asset allocation philosophy for investors:

TWST: Would you give us a few examples of some favorite stocks right now?

Mr. Brown: We're in some gaming stocks, some retail - GameStop (GME), Time Warner (TWX), Sinclair Broadcast (SBGI).

TWST: What about each of those appeals to you?

Mr. Brown: If you look at the earnings yield, the earnings divided by the price of the stock, they're very competitive with bonds right now, so they're very inexpensive. They have stable or accelerating earnings growth rates. They have sales that have been increasing. They're paying a very healthy dividend, and they've been raising their dividends. In most cases they're either buying back their stock or paying off their debt or both.

TWST: What prompts an exit for you?

Mr. Brown: In general, if a stock is down 8% or 9% below where we bought it, it's gone. We want to limit the downside. If the fundamentals start to collapse on us, we might let it go. In other words, if the sales or earnings begin to disappoint and no longer look like they're growing or accelerating, we'll exit.

If the market begins to get toppy or expensive, we might look to reduce exposure. Another way of exiting is when the market is in a tailspin and we want to do some buying, we're going to sell the weakest stocks and use the proceeds as cash.

TWST: How much turnover do your portfolios typically experience?

Mr. Brown: It really depends on the year. This last year, it has been fairly low.

TWST: What are the most common questions or concerns that you hear from clients today, and how do you address those?

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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