Our Investment Philosophy
Our investment process starts long before we invest any of your money. It begins when we meet for the first time and continues as we learn more about you, your goals, your fears and what you value in life. One of the first questions we often ask is, "What do you want your wealth to do?" It sounds like a simple question, however we find it’s not always easily answered. We take the time to help our clients define this question and clarify their answer because this gives us the direction we need to help solve their financial issues between HERE and THERE. The process involves detailed discussions on all the areas of your financial life, but what drives the process is our philosophy.
Our investment philosophy is simple. It’s made up of just a few fundamental concepts, but what makes it work well is our unwavering ability to stick to what we know works. The cornerstone of our philosophy is that the world’s markets are not your enemy, they are your friend. We want to participate in them over time and not attempt to outsmart them. We resist the temptation to practice strategies like market timing or day trading and stick to a consistent strategy of investing in several different areas throughout entire market cycles. We build portfolios that are built for all seasons of the markets, but have the ability to adapt by over-weighting or under-weighting segments of the portfolio as market conditions change. This is what we believe delivers consistent wealth accumulation over the long-term.
We believe diversification is critical to managing risk. We attempt to diversify away as many elements of risk as possible. We allocate our portfolios across a broad range of different types of investments that don’t move in perfect correlation with each other. This can help provide a smoother ride through the inevitable ups and downs of investment cycles. Furthermore, each investment type is broadly diversified within its own category. This minimizes other types of risk like industry risk and company risk. This also helps achieve our goal of diversifying away as many risks as possible and leaves us with market risk as our primary portfolio risk. As we see it, there is enough risk in the broad markets alone. There is no need to take additional, unnecessary risk by trying to pick what individual stocks, bonds or other investments are worth owning. Keep in mind that diversification does not ensure a profit or guarantee against loss. All investments involve risk which may result in loss of principal.
Balance is the key. Many advisors boast of beating the market, but at what cost and at what risk? Others may focus on being the least expensive, but not get the portfolio risk level right or deliver mediocre results. The fact is risk, return and costs are all related. We believe equal attention should be given to all three factors and that no single one is more important than the others. While many in our industry will focus on one, we stay focused on finding the balance that is right for you.
We believe equity markets can help grow your assets and that broad diversification can help you manage risk. By coupling this with an investment platform that is cost conscious in a commission-free, fee-based environment, we provide you with a solid platform for helping your wealth do what you want it to do.