Investment Management
Focusing on the Fundamentals
Our investment philosophy is to employ the same time-proven principles successful institutional investors commonly employ.
Investing is not about beating the market but capturing the returns the market offers to those who take a long-term view. History shows that the longer an investor’s time horizon, the more likely they are to outperform someone trying to time the market and diminish their risk.
Investment risk can also be dampened through diversification which is achieved through strategic allocation. Strategic allocation is the blending of investments with different risk-return profiles to reduce portfolio volatility.
Investing is also about keeping as much of the return as possible by keeping costs low and being tax efficient. By choosing tax-conscious investments and employing tax-efficient strategies real return (the return realized after inflation and taxes) is maximized.
We also believe in enhancing portfolio returns by purposefully adjusting strategic allocation to coincide with the current economic cycle. Understanding the economic cycle and the types of investments that do better in its various stages can increase long-term gains by reducing losses. We tactically tilt strategic allocation to lean into opportunities and away from risks that are commonly found at the various stages of the economic cycle.
At the core of our investment process, you’ll find:
- Long-Term Strategy. It’s not about timing the market, but time in the market.
- Diversification. We invest in multiple asset classes, sectors, equity styles, and factors to reduce overall volatility in your portfolio throughout the economic cycle.
- Cost-Conscious ETFs & Mutual Funds. We focus on returns net of all fees and expenses when evaluating investment options.
- Strategic Allocation. Every investment decision you delegate to us gets made in consideration of both your long-term plan and current market data.
- Tactical Tilts. We are always prepared to pivot through shifts in the economic cycle by leaning into specific factors, sectors, and asset classes.
- Tax Loss Harvesting. Because taxable accounts receive capital gain/loss tax treatment, we are sensitive to the tax implications of every buy and sell decision. We look for opportunities to offset gains with losses by using the unique nature of capital investment taxation for our client’s benefit.
- Alternative Investments. When appropriate, we implement investments with a low correlation to traditional investments to further diversify and reduce the overall volatility of a portfolio. These investments include REITs, Hedge Funds, Private Credit, Private Equity, Interval Funds, and Opportunity Zone Funds.
- Municipal Bond Portfolios. Municipal bond portfolios can reduce taxable interest income for high-income earners.
- Options Strategies. An options overlay can generate income while strategically unwinding concentrated stock positions.
Here are some of the more frequent questions we receive from clients and prospective clients in relation to our investment management philosophy:
While no one can predict exactly when a major market correction will happen, we know they do happen. This is why we believe in adhering to investment fundamentals such as long-term investing and not trying to time the market. Because the market tends to move in tandem with the broader economic cycle, we filter through the headlines to the underlying economic data. This data is what influences the tactical adjustments we make in our client portfolios to dampen volatility and minimize losses during these times and to position portfolios strategically for the next phase of the economic cycle. We encourage our clients to keep their long-term perspective to avoid making costly, emotional decisions, and to revisit their financial plan so we can determine what, if any, impact the market drawdown has had on their probability of achieving their goals and not outliving their money.
To quote Will Rogers, “You go out on a limb because that’s where the fruit is.”
We use advanced tools to provide an in-depth analysis of your current holdings, how they would fair during different market events, and how they compare to benchmarks. Taking tax implications into account, we work with you to make informed decisions about how to better allocate our assets based on your risk tolerance and current market conditions.
We understand that managing your taxable income takes thoughtful planning because no two situations are identical. We utilize robust tax analysis software and collaborate with your CPA on tax mitigation strategies and estimated tax payments. We provide education and research support so you and your tax professional can make thorough and informed decisions based on your unique situation. We implement strategies such as tax-loss harvesting, Roth conversions, gifting strategies, accelerating or delaying income, or adjusting retirement plan contributions.
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