Mr. Bronson: Strong Investment Management is an investment advisory firm federally registered with the SEC. We are a relationship-focused organization that strives to achieve investment success for our clients not only during bull markets, but more importantly to protect their assets during the adverse periods. As a portfolio management team, we have decades of experience that dates back to 1970. We've been able to effectively outperform the broader market averages with our conservative investment policies. Our goal is to anticipate market trends and hold quality investments for client portfolios. We have a top-down approach, in which we decide individual investments by determining major market themes, analyzing the economy and the various sectors of the marketplace to find individual investment opportunities. Primarily, we search for companies with a history of exceptional earnings, proven management and strong earnings potential going forward.
TWST: Forbes recently named you one of the best investment management firms to have overcome the bear market of 2008, and it also noted your outstanding track record through 2009. How did the Focus Growth portfolios perform last year? What were you able to see in the market and capitalize on that others didn't?
Mr. Bronson: The market correction from the third quarter of 2007 through March of 2009 was well anticipated by our portfolio management team. We made the determination based upon certain economic factors that the market was to enter a period of extended decline and possibly lead to a bear market. As the stock market became overpriced, in our view, and the economic data continued to point toward a recession, we actively reduced the equity exposure of our portfolios. By the end of 2007, our average account held only about 50% in equities. And a year later, in September of 2008, we had less than 20% invested in equities in most accounts. Keep in mind, our reduction in equities was well before the Dow Jones fell about 30%. As a result, our Focus Growth Equity portfolios only declined about half of what the Dow Jones and most mutual funds did during 2008. Fortunately, we preserved client capital and held significant amounts of cash, bonds and no-load bond funds during that period. In early 2009, we determined that the market was likely to finally bottom, and we significantly increased our equity exposure, which helped us produce a return of over 30% in those accounts for the year.
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