Our primary task is to meet client objectives and risk tolerances given the options the financial markets present to us through different asset classes such as equities, fixed income, and hybrid securities such as convertible bonds and convertible preferred stocks. We are continuously evaluating the relative strengths and weaknesses of these different options, and have the flexibility to weight portfolios most heavily to the most attractive asset classes.
In the low interest rate environment of recent years, we have emphasized equities over fixed income investments, as equities appeared to have greater growth potential and higher current yield than notes or bonds, while better protecting against inflation. We believe that long term, responsibly diverse equity investments offer a greater opportunity for a reasonable positive return while defending against the three risks mentioned above than other liquid financial assets.
Our strategy generally involves investments in common stocks, convertible bonds, and convertible preferred stocks issued by U.S.-based companies that are of high quality. Rather than investing directly in foreign-based securities, we prefer to obtain international market exposure by investing in U.S.-based companies that manufacture, market, and sell their products and services both domestically and internationally.
We define high quality companies as those with long-standing records of successful investment return, prudent management, comparatively attractive ongoing fundamental accounting and intrinsic value measurements, and comparatively attractive dividend and current income returns. The focus on high quality is important to us because equities as an asset class have a very wide range of risk, despite often being considered risky across the board. By focusing on high quality companies that have performed well through the ups and downs of multiple business cycles and that we expect to continue doing so in the long-term, we are able to maintain reasonable levels of risk across our portfolios.