Company History

Castle Asset Management was founded by breakaway brokers who understood the value of independence.  They understood the value of providing advice for clients rather than providing products to customers.  Castle was very much a continuation of their B/D business--except now it was in a fee-only environment rather than a commission-based environment, thus better aligning advisor interests with client interests.  That continuation was a diversified mutual fund allocation encompassing numerous asset classes and sub-classes.  In essence, the story of Castle was rather ordinary until it wasn't--until it had to be something different; that time was the Autumn of 2008.  Equity markets, both domestic and abroad, lost greater than 35% in 2008.

Domestic equity markets had peaked in October of 2007, and thus began to slowly deteriorate--the dislocation between the economy and stock market was only apparent to a very few.  Normally highly liquid, certain aspects of the credit market froze; a large factor in the downfall of Bear Sterns.  Equity markets had not completely priced in the events yet to transpire--and even stabilized into the summer of 2008.

After government intervention was likely stalled and economic conditions were unlikely to turnaround, Castle took sweeping and unprecedented action:  quickly raising cash levels and hedging downside risk with a short position.  Equity markets continued to decline another 30%; Castle's clients were very much insulated during this time.  Not until late into the first quarter of 2009, did they begin their tremendous rally.  By which time, Castle had eliminated the downside hedge and reinvested much of the cash position.