I first want to acknowledge and mourn the October 2025 passing of Pete Simpson, who led this company for many years. He guided the firm in honing many of the principles discussed here, and was a mentor to me. We appreciate his years of service in building Woodstock into the institution it has become. We will miss him.
What makes Woodstock work well? In my view, there are five principal factors which make Woodstock’s investment management proposition unique.
Our Service Focus
This may sound familiar, but foremost it is our people and their service orientation. Clients and portfolio managers get a high level of support from our sister company, Woodstock Services. They are responsive to customer questions and requests, and navigate the bureaucracy, enabling our portfolio managers to focus on more complex client issues, stock analysis, and portfolio maintenance.
On the investment side, service means taking the needs of individual clients into account. We don’t rely on a “model portfolio” to guide investments. While Woodstock portfolios have a lot in common with each other, we believe each portfolio should be crafted with the client’s unique circumstances and preferences in mind. The stock prices when funds are contributed or withdrawn are likely to be different from the prices when model portfolio positions were established, making client portfolios’ performance different from the ideal portfolio they strive to replicate. All active managers strive to make timely decisions based on market conditions, but when trading, we further take into account the needs of each client to have more or less cash, to take on more or less risk, and tax sensitivity. Woodstock’s stock selection decisions are coordinated with asset allocation decisions and transactions based on client needs.
Stocks Over Funds
The second principle is that we manage individual stocks owned by our clients. Actively selecting and monitoring individual holdings has several advantages over investing in funds. To the uninitiated client, it can be hard to appreciate the difference. Keeping up with the market indices is a challenge for everyone and we don’t promise to outperform other investment managers. However, by investing in individual securities, we can manage your capital gains taxes in a way that managers of funds cannot. Our tax-loss selling is necessarily customized to each account.
Tax-loss selling alone can generate savings comparable or higher than our management fees, effectively offsetting our fees. A Vanguard study found: “[tax-loss harvesting] alpha—the potential additional annual after-tax return achieved by conducting [tax-loss harvesting]—to range between 0.47% and 1.27% [per year].”[1]
Another advantage of investing in individual stocks is that clients aren’t incurring a second layer of investment management fees at the fund level. Further, Woodstock portfolio managers are following what company executives are saying about their businesses and industries. This fundamental research informs our macroeconomic view “from the bottom up” and it helps your portfolio manager make timely, informed investment decisions for your account. Finally, if our clients understand what they own, and our portfolio managers can explain clearly why they own what they own, clients are more likely to stay invested through the market’s ups and downs.
Thorough Knowledge
The third factor is that we know our investments well. There are 91 stocks currently on the Woodstock Monitor List. We get to know them thoroughly by following them over the long term, discussing them regularly to understand better their competitive dynamics, risk factors, and growth potential. That’s our investment discipline. We put a handful of these stocks, 40 or so, in a basket—your portfolio—and we watch that basket closely. We don’t get every stock right, but we limit our focus to this list, having more in-depth discussions on fewer stocks.
Long-term Focus
Fourth, our portfolios are better off because we aren’t attempting to trade short-term trends. We aren’t chasing shiny objects. Our ability to trade is limited because we review and trade each portfolio on an account-by-account basis, and because we are tax-sensitive. We are therefore forced to prioritize our ideas and to focus on the long term. We follow stock news daily, but rarely react to whatever the financial media and short-term investors are focusing on. Having said that, short-term setbacks or excitement sometimes offer opportunities for long-term investors to take the other side of the trade.
Collaborative Competitiveness
Fifth, our portfolio managers are engaged because we are accountable for making real-world decisions for clients. We all have to answer to clients (and the other portfolio managers have to answer to me!). Woodstock portfolio managers are also analysts following specific sectors and industries. We rely on the quality of one another’s research, “eating one another’s cooking,” or we have a vested interest in challenging it, as the case may be. We try to foster an environment where everyone speaks their minds because we all have valid points to bring to our investment discussions. The candid exchange of ideas brings out a broader perspective on individual stocks and results in better investment decisions for every client. We are team-oriented, but the healthy level of competitiveness serves clients as we vie to generate exceptional performance.
The Results
It’s unusual for an investment advisor such as Woodstock to have 90% of its assets under management in one investment performance composite. Last year, almost 90% of the assets we manage are included in our Growth Composite, generally comprised of accounts with stock allocations at 70%-100% of total account values. We think clients are best served over the long term by a generous allocation to equities. While client preferences and account mandates do vary quite a bit, we aren’t trying to hide the performance of any group of accounts behind a curtain.
Woodstock’s Growth Composite slightly outperformed its benchmark in 2025 gross of fees, but underperformed net of fees. We outperformed both on a gross and net basis in 2024. GIPS performance is available upon request. The S&P 500 Index returned 86.0% over the last 3 years, driving our Growth Composite benchmark up 69.3%. That’s a tough bogey to meet. We kept up with it gross of fees over the three-year period, but again not net of fees. We believe our clients are still pretty happy with how their assets have grown. If we can participate in the upside, while providing some protection on the downside by investing in high-quality stocks, we are doing our job. Our equity composite remains ahead of our Growth Composite Benchmark over five and ten years both gross and net of fees.
In summary, here are the five factors that make Woodstock a unique value proposition for clients:
- A high level of customer service
- Tax-loss selling in individual securities
- Knowing our stock holdings thoroughly
- A focus on long-term investing
- Collaborative competitiveness
We think the results speak for themselves.
— Adrian G. Davies, CFA — President