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W.E. DONOGHUE & CO., INC.
Registered Investment Advisor Since 1986
W I L L I A M E . D O N O G H U E
Chairman of W. E. Donoghue & Co., Inc.
the Internet, and a complex economy have seen some investors prosper
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New Times,
New Opportunities
We’ve seen unprecedented growth in the
financial markets and expansion of the
mutual fund industry has been even more
dramatic. In addition to general, diversified
mutual funds, you now have a variety of
Providing a Unique Perspective
new choices. From exchange-traded funds,
country specific funds, industry sector funds,
and Trusted Advice Since 1986
W.E. Donoghue & Co., Inc. was founded in 1986 to
enhanced index funds, to bull market funds, provide professional investment management services
bear market funds, and more. There are to individuals, corporations, and institutions, including
trusts, employee benefit plans and retirement plans.
greater opportunities than ever before.
We are a team of professional service advisors with
But with these increased choices and many years of combined experience in the financial
opportunities come greater complexities services industry.
and potential pitfalls. At W. E. Donoghue & We are passionately committed to assisting you build
a more secure future. Our goal is to help you maximize
Co., Inc., we make sense of these exciting all you’ve achieved in life. We believe it’s not only our
new instruments and harness their responsibility to help you protect and make the most
of your income and assets, but also to help you make
remarkable power for your benefit.
the most of your life.
We will work with you to understand
your current financial picture, talk
with you about the future you envision,
and together we will construct a
strategy to move you from today
to tomorrow. We offer a full range
of financial planning products and
services designed to help satisfy
your personal financial needs. Our
recommendations for your plan are independent, not
tied to any single financial company, so we can provide
you with a range of options.
You can expect the highest professional standards,
insightful and objective advice, and constant attention
to your account. Your money matters. Trust W. E.
Donoghue & Co., Inc. for prudent plans that span
volatile times and allow you to experience the financial
freedom you deserve.
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y o u r p o r t f o l i o s h o u l d re p re s e n t t h e
o p t i m u m r i s k / re w a rd t r a d e o ff
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The Donoghue Approaches
Mutual funds offer many unique advantages –
advantages that are the building blocks of
your portfolio. These include a wide range of
investment objectives, diversification, liquidity,
professional stock selection, and disclosure of
management policies. Using mutual funds
within our investment strategies helps reduce
risk by providing instant diversification across
hundreds of securities within each asset class
and allows us to move assets overnight between
funds with little or no cost. We combine the
benefits of our portfolio strategies and asset
class selection with professional mutual fund
management to assist you in meeting your
investment objectives.
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Momentum Trends
The most simplistic definition of a bull market is when a major stock index such as the
Standard & Poor’s 500 (S&P 500) rallies 20% from a prior low. A bear market is a 20%
decline from the most recent high. But in the current market environment, the
definitions that perhaps carry the greatest weight, and could effect investors’
portfolios the most, involve so-called cyclical and secular market moves.
Simply put, a secular bull or bear market is one that can be measured in decades. They
are "once-in-a-generation" events. There have been four secular bulls and four secular
bears since 1900. This environment favors a buy-and-hold approach.
In contrast, a cyclical move is a market trend that lasts several months to a couple of
years. There have been 33 cyclical bulls and 33 cyclical bears since 1900. This environment
favors a more active strategy.
These cycles provide the basis for W. E. Donoghue & Company’s investment portfolios,
which we call our "reality based" investment approach. Reality based means that we
base our decisions on what the market is doing, not on opinion. We construct proprietary
models that track current market cycles and steer us toward the sectors of the market
that have the highest probability for success. We look to identify trends.
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The Donoghue Portfolios
Power Income Portfolio: This portfolio is designed to maintain long-term capital appreciation
while producing high current returns. It invests primarily in high-yield bonds and money market
funds and utilizes our proprietary risk-reducing system, which moves investments between these
two asset classes to minimize losses during a downturn and maximize gains during upturns. This
model operates according to the momentum of the markets, and not on subjective judgments.
This portfolio is suitable for conservative investors who will need their funds within the next 6 to
24 months and whose primary goal is preservation of capital. This attractive alternative to buying
government or corporate bonds is often used in conjunction with other W.E. Donoghue portfolios
for the conservative portion of a larger portfolio.
and growing your assets. The Conservative Tactical Growth Portfolio is designed to create a risk level
below that of the S&P 500. It is appropriate for investors with a relatively
low risk tolerance and a time horizon of three years or longer. It is an
excellent choice for the investor seeking a safe haven in a turbulent world,
but still desires upside potential.
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visit us on the web at
w w w. d o n o g h u e . c o m
Moderate Tactical Growth Portfolio: This portfolio is designed for investors who seek the upside
potential of sector rotation into domestic stocks combined with defensive bond fund management.
This actively managed portfolio, which consists of a maximum of 10 funds from a universe of at least
25 funds, will rotate 75% of the assets amongst domestic sector funds, broad asset class funds, and
fixed income funds. The remaining 25% of the assets will be defensively invested in bond funds
and accompanied by our proprietary risk-reducing system that moves assets to money market funds
when necessary. This portfolio has the ability to invest up to 60% of its assets in fixed income funds,
and the universe of funds may consist of open-ended mutual funds, exchange traded funds, or
variable insurance sub-accounts.
The Moderate Tactical Growth Portfolio is designed to create a risk level equal to that of the S&P
500, but with greater upside potential. It is appropriate for investors with moderate risk tolerance
and a time horizon of three years or longer.
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Join W.E. Donoghue & Co., Inc.
Opening Your Account
You’ll find that it’s easy to work with us. Your managed account is held in your
name at one of our custodians. Currently we work with a number of firms such as:
TD Waterhouse, Fidelity Investments Institutional Brokerage Group, Schwab Institutional,
FOLIOfn Investments, Inc., American Skandia Life Insurance Company, Nationwide Life
Insurance Company and Security Benefit Life Assurance Company. Once your account
has been established W. E. Donoghue & Co., Inc. is added to the account with a limited
power of attorney. We act as third party investment advisor which then authorizes us
to execute transactions on your behalf.
If, for any reason, you choose to close your managed account, all that is needed is
a 30-day advance written notice. This notice will be served as the effective date of
termination and will be the basis to determine the pro-rata refund of any unused
and previously paid management fees. There are no "exit fees" or other expenses
imposed by W. E. Donoghue & Co., Inc., for closing your account.
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For additional information about how
W.E. Donoghue & Co., Inc. can help
you achieve your goals, visit our website:
www.donoghue.com
260 North Main Street I Natick, Massachusetts 01760 I phone: 800-642-4276 I fax: 774-290-0006
e-mail: info@donoghue.com I website: www.donoghue.com