Portfolio Management
Every client has different goals for their investment portfolio. Furthermore, each client typically has a different tolerance for risk, even within the same family. As a result, we endeavor to tailor each portfolio to your individual needs and priorities.
Some of the factors we take into consideration include:
- Investment Objectives: What goal(s) do you have in mind for your portfolio? Is it retirement, college for children, second home, current income or something else?
- Socially Responsible: Are there any restrictions or types of investments that should not be allowed so that your portfolio will align with your personal convictions?
- Net Worth: What does the big picture look like? Are these monies all of your investment dollars or just a portion?
- Risk Tolerance: There are numerous types of risk. These include: market risk, credit risk, inflation risk, default risk, currency risk, loss of liquidity, taxation, as well as many other types of risks the investor may not realize.
- Return: What is a reasonable rate of return to you? Reasonable returns in today’s markets may be different from expectations ten or fifteen years ago.
- Time: What time horizon do you have for your money to be invested? Is there a deadline to be met such as the date a child goes off to college?
Part of the portfolio management process is the allocation of assets. We implement Strategic Asset Allocation and Tactical Asset Allocation strategies as a part of our management process.
- Strategic Asset Allocation: This is a strategy that involves setting different percentage targets for a portfolio taking into account the age of the client, risk tolerance, time horizon, etc. This process determines how much should be invested in broad categories such as stocks or bonds. This strategy is periodically rebalanced either yearly, quarterly or once an asset exceeds its target by a set percentage amount.
- Tactical Asset Allocation: This strategy is more dynamic than Strategic Asset Allocation. It takes into consideration current and expected factors affecting the market and makes adjustments to either take advantage of potential opportunities or to mitigate possible adverse conditions. An example would be how tariffs or interest rates may affect an asset class.
By talking with you and listening to what you want to accomplish with your investment funds, we can design a portfolio that can meet your objectives without taking undue risk. We call it Fiscally Fit money management.