Our Services

We offer two distinct portfolio services -- Managed Mutual Funds and Managed Equities. Our managed equities service seeks capital appreciation by investing in small company stocks. Our managed mutual funds service employs the full spectrum of socially responsible mutual funds, serving needs from current income to long- term growth.

Portfolio Starter

Incorporating values into investment decisions is the basis of socially responsible investing. Bridging the gap between profits and principles is the essence. It allows investors to vote with their dollars, channeling them toward companies that reflect their beliefs.

Principle Profits, Inc. provides a specific discipline within our Managed Equities service. We seek capital appreciation by investing in micro-capitalization, domestic equities. We define micro-cap as $500 million in market capitalization or less. We do not short stocks, we do not margin, nor are we involved in any option trading at all. We are not involved in any international stock markets. Our investment approach is bottoms-up; that is, we look at each individual investment candidate on its own merit, as opposed to trying to "time" the overall direction of the market. Therefore, we strive to be fully invested at all times. Any managed assets not currently invested in stocks are held in socially responsible money market funds.

Our management style is best described as GaaRP, that is, Growth at a Reasonable Price. We seek out companies that possess traditional "value" type fundamentals, with the presence of "growth" type catalysts that enhance the potential for capital appreciation. Principle Profits, Inc. employs a three-fold analysis system in determining what stocks are to be included in our clients' portfolios:

1. Principle Profits Ranking- Each company that is to be considered passes through our proprietary ten-point ranking system, which examines items such as financial ratios (P/E, Price/BV), performance (ROE, cash flow, earnings) as well as other less traditional factors. A company must score a 6.5 or better (out of a scale of 0.0 to 10.0) to be included within the "universe" of stocks that go on to receive further analysis. Companies that do not receive a 6.5 ranking due to certain circumstances, and yet are worthy of inclusion, are classified as "Special Situations", and are limited to no more than 15% of invested assets.

2. Social-Issues Assessment- Our social-issues assessment is client directed. We request that our questionnaire be completed by each company, and then do follow-up with a telephone interview. We also utilize a variety of publications and research providers that deal with social investment issues, to ascertain the level of commitment to social responsibility for each company. We then grade each company from A+(excellent) to F(fail), and consider only companies that achieve a B grade or better.

3. Technical Analysis- Those companies that make it through our first two levels are then analyzed technically, to determine optimal points of entry and exit. We employ four different methods (Candlestick, Stochastics, Moving Average Convergence/Divergence and Wilder Relative Strength Index) over five year, one year and ninety day time periods. This allows us to gauge the comparable technical strength of the stocks within our "universe".

Managed portfolios of mutual funds have become an increasingly popular investment option over the last several years. Not only have individuals embraced mutual funds in record-breaking numbers, but institutional investors have also employed this increasingly popular asset management tool as a method of choice.

Of course, there are many good reasons for this evolving trend. Mutual funds offer solid advantages to investors, such as;

Our mutual fund portfolio management can serve the needs of all investors, from current income to aggressive growth, including international exposure. We do not attempt to time the market with frequent trading in and out of funds. Rather, our style is that of strategic asset allocation. We work with our clients to determine the most appropriate mix of funds, depending upon financial objective and risk profile for each individual situation. We then utilize a wide variety of socially responsible funds to help our clients achieve their goals.

Our social-issues assessment is client directed. We encourage clients to take an active role in the development and application of social-issues criteria. Where our assistance is desired, we will help develop a specific set of investment guidelines. Any area of social-issue concerns regarding a specific company's practices, that is in potential conflict with client directives, is discussed with clients prior to any action being taken.

Our assessment process is comprised of gathering both primary and secondary research. For primary research, we request that each company complete our social-issues questionnaire. We follow up our questionnaire with telephone interviews, when more in-depth information is necessary. Our secondary research involves the utilization of a wide variety of publications and research providers that deal with social investment issues (see below). We then grade each company from A+ (excellent) to F (fail). We consider only companies that achieve a minimum grade of B for inclusion in our clients' portfolios.

• Kinder, Lydenberg, & Domini's Socrates database service.
• The Clean Yield investment newsletter.
• Franklin's Insight investment newsletter.
• U.S. Trust Co.'s Value investment newsletter.
• Various periodicals, such as Business Ethics, Executive Citizen, Greenmoney Journal, Responsive Investing News, etc.
• Member of the Interfaith Center on Corporate Responsibility.
• Member of the Council on Economic Priorities.
• Member of the Data Center.