Mr. Hay: We are a traditional money management firm, in other words a long-only money management firm, in Bellevue, Washington. We were formed in 1983. We have been around for a while, although I did not buy majority ownership until 2002, when I rolled my client base in there from Smith Barney. I've only been with the firm for about five and a half years, but I've been in the business since 1979. We have gone through a lot of crazy times in the market, but I will say this is certainly one of the more interesting. We not only use individual securities, we also use ETF securities, which we incorporate into our Right Cycle Investing strategy. Right Cycle Investing is really kind of our signature solution, because it kind of permeates everything that we do. Even the non-Right Cycle investments that we manage really follow that kind of contrary-to-the-herd type of approach, and we use mutual fund flow analysis to determine when the overall mutual fund population is really bullish or really bearish and then we blend that with traditional valuation analysis to try to look for a convergence, because they don't always line up. There are times where you'll see extreme enthusiasm and yet valuations still look either cheap or at least okay, and, yet, when things go to the extreme, that's when we get interested. When you have extreme inflows with very high valuations, that's when we go to an underweight under a particular style, let's say small cap value or, conversely, today, where large cap growth has been so out of favor for so many years and it looks extremely attractive from both a mutual fund flow standpoint and also a valuation standpoint. We also spend a lot of time looking at the income side. Unlike a lot of managers, we have clients that want cash flow and we are not just focused on appreciation but actually generating a living income for our clients. We are quite active with things like preferred securities and publicly traded partnerships and royalty trusts as well as traditional bonds. That's kind of an overview of how we do things.
For more information call (212) 952 7433. The Wall Street Transcript does not endorse any of the comments made by interviewees, and does not make stock recommendations.