Way Points
Performance Summary
Total Return on $100,000
225000 212500 200000 187500 175000 162500 150000 137500 125000 112500 100000 87500 75000 62500 50000
News In Brief
Portfolio Statistics as of 9/30/13:
32 Equity positions 9% International equities Core portfolio average holding period 2-3 years
Blue Point seeks equity-oriented growth at a reasonable price with a global perspective. During the third quarter, Blue Point, which is based on a model portfolio applied to separately managed accounts, returned an impressive 12.31% after advisory fee. Anatomy of a Home Run Nokia on the next page discusses a primary source of the quarterly outperformance. The total return of the S&P 500 during the third quarter was quarter was 5.24%. Blue Point offered clients more than twice the return offered by the total return of the S&P 500 during the third quarter. Year-to-date Blue Point has returned 24.37% while the total return of the S&P 500 was 19.79%. This means that Blue Point outperformed the benchmark by 4.58% after advisory fee.
2006 1Q07 2Q07 3Q07 2007 1Q08 2Q08 3Q08 2008 Q109 Q209 Q309 2009 Q110 Q210 Q310 2010 Q111 Q211 Q311 2011 Q112 Q212 Q312 2012 Q113 Q213 Q313
Blue Point
Disclosures: Performance of the separate accounts can differ substantially from the actual performance of Blue Point, the model portfolio, due to timing of entry, whether account is taxable or non-taxable, and the timing of withdrawals. Past performance does not guarantee future results. The management fee schedule is as follows: 1.2% on first $1 million, 1.0% on the next $3 million, 0.85% on next $5 million. Accounts under $0.5 million are 1.5% annually. Depending on circumstance, institutional fee schedules may be negotiated. Blue Point Investment Management, LLC, is a Maryland registered investment advisor, founded in 2006. To receive a copy of the firm's Form ADV Part II, contact us at 443-600-8050.
Market Outlook
Not Everything Goes Up The upward march of equity valuations is challenged by slower earnings. Quantitative easing on its own does not create confidence. The equity markets are overdue for a correction. Shift in U.S. Energy Needs The discovery of shale gas and oil is creating a reversal of fortune. The U.S. is becoming increasingly energy independent, but more importantly a huge wave of energy infrastructure and industrial investment is occurring. Low Growth Creates a Cost Focus - In the absence of revenue and wage growth, companies and consumers are very cost sensitive. This creates demand for low price leaders, software and automation which, in turn, enhances U.S. competitiveness. Not So Rosy for the BRICs Brazil, India, Russia and China have been enormous beneficiaries of capital inflows. The magic is not lost but the wind is no longer at their backs. A lack of government reform, higher wages, and inflation are creating challenges. Equities Favored Asset Class Equities offer a claim on the earnings of real assets. Unlike money real assets cannot be printed. Fixed income is negatively impacted by more printed money.
Portfolio Manager Niall H. OMalley (443) 600-8050 niall.omalley@bluepointim.us Web site www.bluepointim.us
Way Points
technology on mobile devices. Nokia offers a distribution platform that is selling mobile phones to the next billion users. While there were many challenges associated with the speed of Nokias turnaround there was a material cushion from Nokia Siemens Network. The operations of Nokia Siemens Networks, while generally not profitable from an income statement perspective, created a cash cushion for Nokias turnaround. Interestingly, value investors were quite upset that Microsoft was investing in lower margin growth with the announced Nokia transaction and, as a result, Microsoft stock sold off 10%. Value investors forget that Microsofts financial
Individuals Institutional Total