January 2010 Letter
As you might expect, we keep a file of the material we send you each quarter, and in looking at our April 2009 letter, we had just concluded a first quarter decline of 25% in the S&P 500 stock index. Who would have guessed that the following nine months would see a 65% rise in the S&P, resulting in a total net gain of 24% for the year?
As the enclosed letter titled "Dinosaur Talk" discusses, Covington’s investment strategies should minimize the chance of having catastrophic losses in our portfolios. We are willing to give up some upside opportunity to make sure this happens. Avoiding large losses has been the key for positive long-term investment returns since we founded our firm five years ago.
I am pleased to report that at year-end 2009, we had a record amount of assets under management which exceeded $1.3 billion. In addition to achieving competitive investment returns, this increase in assets is also due to referrals from our outstanding group of clients as well as friends of the firm who have been so supportive.
Our enclosed material outlines the challenges to be faced in 2010. We look forward to hearing from you should you want to discuss our thoughts in more detail.
Dinosaur Talk
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