Firm History

HGK Asset Management was incorporated and registered with the SEC as a Registered Investment Advisor in June of 1983. HGK began to manage institutional accounts in the same year.

The firm was founded by three principles, Jeffrey Harris, Warren Greenhouse, and Joseph Kutzel, along with Michael Pendergast and Carol Bandille, who were previously associated with L.F. Rothschild, Unterberg, Towbin Asset Management.

Over the past quarter century, HGK has grown into a global firm maintaining the same values on which the firm was founded.

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Firm Investment Philosophy

HGK adds value for clients through active management in its domestic equity, international equity and domestic fixed income strategies. By investing in undervalued securities through a disciplined bottom-up research driven approach, HGK has consistently exceeded clients' performance objectives regardless of market conditions.

HGK's fundamentally driven quantitative and qualitative security analysis, coupled with its risk averse approach to portfolio construction, provides long-term results designed to consistently outperform a specific market benchmark while minimizing volatility.

The firm's long tenured investment team draws on its historical perspective to navigate through ever evolving securities markets. The experience of every individual contributes to one collective goal: consistently achieving long-term out performance with reduced risk for our clients.

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Domestic Equity Investment Process

HGK's value driven and risk averse domestic equity investment process has been employed in its current form since 1990. The equity team screens for disciplined companies with improving cash flows selling below their discounted present value. Rigorous qualitative fundamental analysis is applied to make the final security selection. During this analysis, the equity team focuses on undervalued companies that operate from a position of competitive advantage and whose management team understands the principles of shareholder wealth creation.

In order to reduce portfolio volatility the funds maintain exposure to all major industry sectors. Each fund strategy maintains guidelines that limit its sector allocations to between 50% and 150% of a designated market benchmark. Additionally, this process serves to reduce systematic risk and allows HGK's superior stock picking abilities to generate alpha for its clients.

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International Equity Investment Process

HGK's International Equity strategies employ a bottom-up, fundamental research driven, and concentrated investment approach built on decades of global investing experience. A vast majority of the research for the International and Global strategies is created in house, based mainly from extensive company visits each year. The team typically invests in companies that are undergoing significant strategic transformations or in companies whose operational capabilities are undervalued by the market.

The portfolios are constructed on an index-agnostic basis, but with absolute limits on country and sector exposure. Securities are generally in the mid to large capitalization range in major markets and are roughly equal-weighted at inception of the position.

Trinity Street Asset Management, based in London, England provides sub-advisory services to HGK's clients in managing their international and global equity portfolios.

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Domestic Fixed Income Investment Process

HGK's fixed income investment process focuses on the active management of spread and credit risk in lieu of interest rate risk. By utilizing extensive credit research, economic models, security option-adjusted analysis, HGK is able to identify and capitalize on opportunities and pricing inefficiencies in the bond market.

Within the course of this active portfolio management, HGK employs balanced portfolio construction with exposure to all broad sectors (Treasury, Agency, Corporate, MBS, ABS) of the fixed income market as a means of reducing volatility of returns relative to portfolio benchmarks. Portfolio duration is maintained between 90% and 110% of the benchmark in order to limit the portion of relative performance tied to an interest rate forecast, leaving sector allocation and individual security selection as the primary drivers of relative performance.

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