We are focused on helping you and your family stay secure, now and in the future. The investments we select for you are all directed at achieving this mission.

The Foundations of Our Selection Method

Our first investment fundamental is that no one can predict the future. There are circumstances under which even supposedly "safe" assets will perform poorly. Thus, we emphasize diversification so that no one risk will keep you from achieving success. The result is a portfolio that as a whole is better than any one of its parts.

The second fundamental is Value Investing. As Value Investors we focus on the price being paid for an investment relative to the value one is receiving. We do not attempt time the market or guess whether a stock's price will be higher or lower in a year. Instead, we make a point of determining the value of the investments we recommend. This is an often difficult and uncertain process but our record of long term investment success shows that we are skilled in doing this.

The Steps in Selecting Your Investments

At Princeton Value Advisors, our first step is to personally get to know you, your current financial situation and your timeline for achieving your goals. We manage your portfolio with these goals foremost in mind and in concert with your other assets and risk tolerance, maximizing the potential and safety of the whole.

Once we know you, your goals and your risk tolerance, our next step is to determine the mix of asset types that will best meet your needs. Within each type of asset, we look for specific investments that meet your goals, time frame, and level of risk tolerance. The result is typically a portfolio that contains a mix of cash (such as money market funds), fixed income investments (such as bonds and annuities), and stocks. The ratios of each asset type vary greatly from client to client.

Regular Review and Adjustment

Once the initial portfolio has been created, we will meet with you regularly by phone or in person to monitor your outcomes and make adjustments to both your asset allocation and the investments in your portfolio. If the changes in your personal circumstances or in the financial markets become significant enough, Princeton Value Advisors may advise a revision of both your investment plan and the asset allocation.

The part of your assets allocated to common stock investments will typically be divided between low-cost mutual funds/ETFs and direct ownership of common stocks in specific companies. The ratio will depend on your risk tolerance and our ability to find suitable individual stocks. For the part of your assets allocated to direct ownership of common stocks, Princeton Value Advisors (PVA) uses the highly successful stock selection methodology developed by PVA's Senior Financial Advisor, David Wertz, Ph.D. (See the web page with his 2000 - present stock picks for details of past investments.)

Stock Selection Methodology

Dave Wertz has achieved phenomenal success as a stock investor by rigorously following a value investing approach based on investment fundamentals. Most investors, including most mutual fund managers and financial advisors, are not value investors. They buy a stock because they think its price will go up. This approach amounts to betting your savings on the irrational ups and downs of the stock market. This is folly in any market – and is especially risky today.

Dr. Wertz doesn't attempt to predict stock prices. He buys a stock only if its future dividends alone will provide a great return. Not only the profit but recovery of the stock's purchase price must come from dividends. His skills as a financial analyst enables him to estimate a stock's future dividends and convert this into a value for the stock. He buys a stock only if its price is well below its value.

The Steps in the Selection Process

Dave Wertz's stock selection process has 4 steps.

1. Using the Bloomberg Professional Service™ stock screening function and PVA's proprietary screening formulas the 60,000 companies covered by Bloomberg are reduced to those with some chance of meeting our investment standards.
2. We investicate the companies selected by the PVA screening formulas. The first step is to examine information that the Bloomberg service has on the company. If the company still looks promising, Dr. Wertz reads the company's recent financial reports and examines the company's web site for additional information. He also reviews any publicly available research reports, but usually they are so short term oriented that they seldom contain any truly useful information. PVA does not make on site visits.
3. Based on information about the company, experience, and any other factors considered pertinent, we develop one or more scenarios about how the company's business will evolve over the long term. We calculate the value of the company under each scenario using computer programs written by Dr. Wertz that implement the discounted cash flow algorithm. If the computerized scenario valuation indicates that the company's stock will provide a superior risk adjusted return, it is purchased. The amount of the stock purchased depends on the expected return, an estimate of the risk of the company, and how the stock fits the client's goals and priorities and their overall portfolio.

After stock in a company is purchased, we monitor the performance of both the company and its stock. We sell a stock only if the company's business performs significantly worse than expected or if the price of the stock rises to the point where the stock is no longer likely to provide a superior return. Conversely, more shares might be purchased if the company's business performs better than expected or the stock price declines substantially with no change in the company's prospects.

Let's Get Started Planning Your Financial Success

Call (609) 683-8005 or email Dr. Wertz at dwertz@PrincetonValue.com today. Your initial consultation is free and without obligation.