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Our Investment Management Approach

There are more than 5,000 banking and savings organizations in the United States. Cypress Trust Company team members speak fluent “real-life” which means we can translate your financial and lifestyle spending habits into sound investment strategies. It may be one size fits all financial planning elsewhere, but here, it’s all about you and your preference for under the radar topics like risk tolerance, income, and cash flow requirements, and more. For two decades, we’ve provided personalized results to our clients. Through markets ebbs and finance flows, Cypress Trust will be watching your money for a lifetime.

To learn more about our investment methodologies, click below.

Asset Allocation Philosophy

We believe asset allocation is the main determinant of portfolio returns. The centrality of asset allocation stems from its role in determining the optimal portfolio allocations to distinct asset classes based on investors’ time horizon. We periodically re-balance the portfolio to the pre-determined long-term asset allocation target and review the asset policy mix in conjunction with investor’s changing needs, expected returns and type and availability of investment instruments.

Our flexible approach allows us to dynamically manage the asset allocation mix within pre-determined bands to position portfolios in relation to changing market conditions.

Equity Management

Cypress Trust Company employs a team-driven approach to its equity investment selection, using a front-end screening process to focus the research efforts of the investment team on a manageable list of attractive stocks. This approach provides a diverse list of equities with strong quality, value and income characteristics as defined by our proprietary process. This quantitative approach is designed to capture the interaction of fundamental investment concepts in a disciplined, consistent manner.
The portfolio managers then research these companies to develop a deep understanding of the company’s long-term dynamics and valuation. In addition to in-house research, third-party research is leveraged in this process. The collective research and views of the portfolio management team are discussed and vetted in Stock Selection Committees. Consensus decisions are reached at these meetings with the output being a Focus List from which portfolio managers construct and manage client-customized portfolios.
The approach aims to manage portfolio risk through consistently investing in equities with strong profitability, cash flows, and attractive valuations. Additional risk management rules are in place for diversification purposes such as maximum position size and sensible limits to sub-industry concentration. Portfolio managers determine whether investment in a Focus List security is appropriate for each individual client.

Investment Advisory Services

Customized Portfolios

For clients who have specific investment circumstances such as low cost-basis stocks, income needs, restrictions on particular types of investments, directed investments, legacy stock holdings, or investment preferences such as socially responsible investing, Cypress Trust Company offers customized portfolios of stocks and bonds.

The Cypress Trust Company Customized Portfolios:

  • Are tailored to each individual client based on his/her goal and preferences
  • Are actively managed with a focus on risk management and diversification
  • Seek to enhance after-tax returns through tax-sensitive management

Separately Managed Account Strategies

For clients with limited or no constraints who are interested in investing in disciplined, focused strategies, Cypress Trust Company offers a suite of Separately Managed Accounts. These provide an institutional quality investment management solution, along with the ownership and transparency you deserve. The investment professionals of Cypress Trust Company adhere to the fiduciary standard, working in your best interest before their own.

Fixed Income Management

Our philosophy is based on pursuing goal-oriented strategies driven by each individual client’s income requirements, risk tolerance, and time horizon.  Income generation and capital preservation are paramount in this approach.  We are largely a buy and hold investor and have a low turnover within our bond holdings.  When purchasing individual bonds, we emphasize high credit quality, liquidity, and diversification across the government, municipal, and corporate sectors.

In our opinion, fixed income investing represents a trade-off between interest rate risk and credit risk.  More often we choose to take credit risk over interest rate risk.  We do not believe in the ability to consistently predict interest rates, therefore, we seek to add value by taking credit risk.  For corporate bonds, our approach to security selection is based on finding value through credit research and comparable bond analysis.  When purchasing municipal bonds we build portfolios with an emphasis on diversifying across maturities, states, and repayment sources.

We also offer ETF-based fixed income solutions which offer exposure to a broader selection of fixed income sectors with the goal of smoothing volatility and enhancing income and liquidity.  These portfolios can supplement core individual bond holdings or serve as a complete fixed income solution.

            Characteristics of Fixed Income Portfolios

  • Diversified, opportunistic strategies.  Yield curve optimization.
  • Emphasis on quality – Investment-grade securities
  • Low volatility
  • Liquidity / Marketability
  • Undervaluation – Credit analysis and credit spread evaluation attempts to identify attractive sectors / issues
  • Taxable or Tax Free

Investment Products are:

  • Not Insured by the FDIC or Any Federal Government Agency
  • Not a Deposit or Other Obligation of, or Guaranteed by, the Bank or Any Bank Affiliate
  • Subject to Investment Risks, Including Possible Loss of the Principal Amount Invested