JACKSONVILLE, Ore., March 28, 2013 /PRNewswire/ -- Cutler Investment Counsel, LLC is pleased to announce that Erich Patten, Chief Investment Officer and Portfolio Manager of the Cutler Equity Fund (CALEX), was a featured speaker at the SunStar Strategic Media Briefing on March 19, 2013 in New York. The event, which showcased undiscovered mutual fund firms, introduced seven portfolio managers to an audience of about 50 financial journalists.
Patten began by discussing "risk management and dividend investing." With today's low level of interest rates, dividend investing is similar to "trying to catch a wave in a crowd." But Patten feels the run up in stock prices caused by investors searching for yield is not troublesome. He feels valuations are not outside acceptable levels. Patten discussed the genesis of his approach to investing, which came from his Grandfather, Kenneth Cutler. Mr. Cutler was a long term investor and a committed disciple of the importance of income in the total return component for over 50 years.
The Cutler Equity Fund invests primarily in large, well-managed and well-known companies. The managers have identified about 140 companies with market caps of $10 billion or more that have paid dividends for at least 10 years without any cuts. "That is a phenomenal commitment," said Patten. "Despite economic headwinds, management has recognized the importance of its dividend and managed the company in a way to support those payments. With today's retirees starved for yield, dividends offer a viable alternative to traditional bond investing, while also providing potential for capital appreciation."
Patten also shared the firm's economic perspective pointing out that despite the fiscal cliff, taxes on dividends did not go up significantly. He said "relative to other equities, dividend stocks may outperform during times of market stress due to flight to quality, similar to how treasuries may outperform other bonds under similar market conditions. With interest rates near zero, dividends have been the beneficiary and we believe these companies will continue to offer investors a good source of income." He concluded his remarks by noting "dividend investing is back, but Cutler was already there."