Portfolio Management
Investment Philosophy
Keep it Simple
From our experience, the components of a properly diversified portfolio should be transparent, liquid, highly tax efficient, and contain minimal—if any—external or embedded fees. Unlike some advisors, we do not endorse allocating substantial capital to hedge funds, investment partnerships, or theoretical “black box” investment models.
Strategic Asset Allocation
The purpose of incorporating different asset classes in a portfolio is to maximize return potential and mitigate risk. Our typical client will have exposure, in varying percentages and at various times, to:
- High Quality Dividend Paying Equities
- US Multinationals and Non-US companies
- Select participation in Small-Mid Cap companies
- Short-Intermediate term Fixed Income investments
- Carefully selected ETF’s and/or Mutual Funds
Custom Managed Portfolios
Portfolio Benefits
Our portfolios primarily consist of individual equities, mutual funds,ETF’s, and fixed income investments. Our ability to custom manage portfolios can create many distinct portfolio advantages for you, including:
- Greater transparency
- Control of “style drift”
- Enhanced tax sensitivity
- Structured rebalancing
Portfolio Transitioning
Investments transferred in during the start up phase of our relationship will be carefully analyzed for portfolio inclusion. Securities failing to meet our standards or the objectives of your portfolio will be sold. The timing of these sales will take into consideration the impact of taxes and current market conditions.
Tax Sensitive Asset Allocation
Allocation – Asset Location
Asset allocation is considered by many as the best means of managing portfolio risk. This process of diversifying investment capital among multiple asset classes is an effective technique to potentially increase portfolio returns and mitigate risk.
Unfortunately, asset allocation has one major shortcoming – it ignores tax consequences. Asset allocation alone fails to consider the tax characteristics of different asset classes, which can hinder returns. Our investment advisors go beyond diversifying portfolios and incorporate asset “location” strategies to optimize after-tax return potential.
Increasing Returns- Balancing Risk
In practice, asset “location” considers the placement of your investments based on their tax efficiency. Understanding both the tax code and the value of properly locating investments can help to increase your long-term wealth without incurring additional portfolio risk.
A Timely Investment Strategy
With tax rates likely to rise in the coming years, the practice of asset “location” will become increasingly important to maximize investment return potential.
All investing involves risk including loss of principal. No strategy assures success or protects against loss. There is no guarantee that a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk.