Investment Management
Consider Roy’s advice. Your investment portfolio’s SOLE job is to fund your holistic financial plan so that you can live the life you love forever. You are NOT trying to make the most money possible because that means taking the most RISK possible; vastly increasing your chance for catastrophic (total) loss.
Wise people understand that investment returns aren’t bragging rights. They know that living the life you love, for the rest of your life is the goal. Wise people hire a great investment manager to run an investment portfolio that meets this objective.
Proper investment management requires the ability to pay attention to what actually matters. Almost all popular financial news is useless drivel. It’s spewed from the mouths of those trying to incite emotional reactions, to drive up their ratings, and increase their advertising revenue. There are, of course, several useful tidbits that rarely make the front page. Investors that succeed watch for these tidbits and adjust course accordingly.
Successful investment management is hard. You can’t learn how to do it from reading websites or buying somebody’s newsletter. To succeed with regularity, you need education, licensing, experience, talent, ethics, insight and humility. If you are intelligent, you could learn it, probably, but you’ll need ten years. Is that how you want to spend you time?
Wouldn’t you rather hire an adviser you trust?
Trust is key. You must believe that he or she has the ability to properly manage your financial life. Click here to review a list of the subjects covered on the recent Certified Financial Planner (CFP®) exams. If you have doubts about your adviser’s competence in any of these areas, you must get a second opinion from a qualified CFP® Certificant. As a CFP® Certificant, we follow the best practices as outlined by the CFP® Board of Standards.
Call us. Meet us. See if you like us. See if you feel you trust our ethics and our competence.
In order to give you a flavor of how we manage investment accounts, consider the following comparison between Us and Them (business practices common at other firms). Which approach would you prefer?
The market dropped 4000 points in four months.
Them: You call the adviser’s office, express your concerns and the adviser says, "Stay the course. Markets recover. You’re invested for the long haul." |
Us: We call you, without prompting, and say, "We wanted to call to talk to you about the economy. We’re in a contraction. We’re not at the recession stage yet. The information from the six leading macroeconomic indicators are troublesome. But, ten months ago, we already took precautions by overweighting your portfolios in lower risk bonds. We don’t know how bumpy the ride will be, but you’re only taking 60% of the risk of the S&P 500. So far, you’re down 15% and the market is down by 65%. We’ll keep you posted." |
It’s time to make a change to your investments.
Them: Your firm decides to sell you a new investment for which the salesman makes a commission. You get to go into the office for a lengthy sales presentation while you wonder if this is really best for you or for the firm. |
Us: We notice the market has changed. We automatically consider your investment objectives, your risk level and your biases. We make the necessary adjustments to your portfolio to make sure you are positioned as well as possible at the lowest cost possible. We don’t charge commissions. There is no financial incentive for us to make trades (or not make trades) in your account other than to fulfill our fiduciary duty to act in your best interest. |
It’s time to build an investment portfolio.
Them: Your adviser sold you an A share from a large fund family with top funds in a couple asset classes and reputable funds in several others. You have roughly 150 investment options with which to build your portfolio. If you want to buy funds from another fund family, you’ll have to pay another load (commission) of up to 5.75%. |
Us: We build an investment portfolio for your risk level out of fifteen thousand options across hundreds of fund families and individual securities. Because we have so many options we were able to pick from the top funds in every asset class regardless of fund family. We have no allegiance to any particular fund family, preferring only to use the best fund in each asset class. When a fund becomes less advantageous, we replace it with a new fund regardless of family. If you change fund families, you never pay a load or commission. |
It’s time to review your investment performance.
Them: You call the adviser’s office and say, “How am I doing?” They say, “Your accounts are doing as well as can be expected in this down market.” |
Us: We call/meet with you and say, “On a risk adjusted basis, you’re doing better than several of the leading indexes. Remember that you felt most comfortable with a trailing 3-year standard deviation of 14, when the S&P was at 20? Well, because of that, you’ve avoided the vast majority of recent market wreckage and are still on track to meet your primary financial goals. Now, last we talked you were retiring early, preparing your business for sale and maintaining a steady cash flow from your investments. Is that still true?” |
Fees. We do not charge commissions for investment management. Instead, we collect a small percentage of your investment assets on a quarterly basis.
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