Potomac Asset Management, a new financial services company with a $90-million base in managed assets, has been formed to handle pension fund and other institutional accounts. The founding partners are long-time Washington professional asset managers Peter Ladd Gilsey and Wilfred L. Goodwyn.
"We will specialize in pension and profit-sharing portfolios, endowment funds, eleemosynary charitable institutions and in individual and trustee-administered accounts," said Gilsey, president of the new firm.
He added that smaller, independent management firms often offer a greater degree of flexibility and responsiveness to the real investment world than do many larger firms with many billions under management. "Since the asset base of the smaller firm is easier to manage, emerging growth companies and special situations may be utilized with greater effect," he said.
Gilsey said that because inflation has reduced present and future "buying power" of individuals and institutional fund beneficiaries, it is vital that capital managers obtain a total rate of return equal to at least a 50 percent premium over the nation's imbedded inflation rate. "In the case of an actuarially sound pension fund," he said, "it is estimated that each one percent increase in its rate of return can mean either a 25 percent increase in benefits, a 20 percent reduction in costs or some combination of the two."
Before founding Potomac Asset Management, Gilsey was special consultant for investments to L.F. Rothschild Asset Management, a division of L.F. Rothschild, Unterberg, and Towbin. He is also a past president of the Washington Society of Investment Analysts.
His partner and executive vice president, Wilfred Goodwyn, previously was a sole proprietor operating under the name of Goodwyn & Co. and is a former vice president of Ferris & Co.
The firm will have offices at 7101 Wisconsin Ave. in Bethesda.