Has your investment approach worked for you? Have you found that over the last decade or so, the risk in your investment portfolio has been higher than you are comfortable with? Does your current approach do a good job of reducing your income tax liability? Have you been disciplined about selling investments that don't work for you any longer? Do you sometimes wonder if the last withdrawal you made was from the right account and that you sold the right investments to get the needed cash? These are all important questions that investors struggle with. Read More
First, we listen to you. We want to know your previous experiences with investments and other advisors. We want to know, as best we can, what kind of risks keep you up at night, or cause you to abandon your long-term plan. We find out when you plan to make withdrawals from your portfolio. We learn about your tax situation so we can craft a "tax-wise" portfolio. These and many other questions go into our understanding of your needs and preferences, so we can effectively determine what will work best for you. We memorialize this understanding in writing in the form of an Investment Policy Statement, to make sure we are all on the same page before any real investing begins.
Next, we fully evaluate your existing investment holdings. If we believe some of them should be retained, then we incorporate those holdings into your new portfolio. Unlike many advisors, we do not sell all of your current holdings in order to fit you into a pre-established, inflexible model. After all, there are usually good tax incentives for holding onto your "legacy" positions.
Finally, we implement our investment preferences, utilizing the best investment vehicles we can find. We use open investment platforms like Charles Schwab and TD Ameritrade to transact and custody client accounts. This provides you with full transparency and reassuring security, along with very low transaction charges. Our relationship with these institutional custodians gives us access to low-expense Institutional class funds, normally out of the reach of most investors.
The implementation phase can be completed quickly, but in most cases will be phased in over time, with some sectors taking 6 to 18 months for full investment. The result of all this front-end effort is a portfolio that is truly a reflection of you - customized with your prior holdings, your risk tolerance, your tax situation, and your long-term goals.
The securities markets reflect an infinite variety of investment philosophies and strategies. We consider ourselves seasoned guides in the market - but also perennial students. We continually research our ideas to better client performance. The one constant in the securities markets is change, so flexibility is a key tenet. We want to maintain the ability to adapt and adjust to the ever-changing investment landscape. This means we try to avoid illiquid investments and overly rigid strategies. Read More
Risk management is an essential focus. We prefer to deliver steady gains to our clients rather than scary (but sometimes thrilling) swings in returns. As a result, diversification is a fundamental part of our investment philosophy. We thoughtfully allocate assets across a global investment market, pulling in international stocks and bonds, and other investments designed to "smooth-out" your investment experience. When a segment of the market is "hot", for example, technology stocks, your diversified managed portfolio will probably not keep up with the hot sector, but in down markets, we hope our diversification efforts will reduce the magnitude of portfolio declines.
Our experience has taught us that there are times to be aggressive in the market, and times to be defensive. We studiously track a range of market metrics to help us determine when the market is "overvalued" or "undervalued," and when it may be primed for a fall or a surge upwards. Investment Committee meetings take place regularly, as well as when there are dramatic movements in the market. These meetings provide a forum for an exchange of ideas regarding asset allocation, security selection and other matters. Advisors are then prepared to determine client equity exposure, relative weighting of domestic / foreign / emerging markets positions, and other possible adjustments. This strategic approach is sometimes referred to as "tactical" asset allocation.
Our investment approach is designed to mitigate the negative tax consequences of portfolio management; that is, we try to earn high investment returns for you without generating big tax bills as a result. We pay attention to the appropriate placement of investments within taxable and tax-deferred accounts, and we continually monitor and review taxable portfolios for tax-loss-harvesting opportunities. Taxes are an inevitable consequence of investment success, but careful tax management and creative planning can reduce this liability. A more detailed explanation of our tax efforts is described in this handout: Improving Your Tax Position