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Investment Strategies


Strategic asset allocation is the primary investment strategy used to implement any investment advice given to our clients.  Based upon current economic, market & political conditions and client-driven factors such as risk tolerance, investment time horizon, tax consequences and other constraints, investments are diversified across several asset classes and investment styles. 
 
Diversification is the strategy of holding more than one asset class in a portfolio in order to reduce risk.  When developing a strategic asset allocation policy, it is important to understand the risk and return relationship of the assets being considered. The goal is to select and combine assets in an efficient manner in order to meet our client’s future objectives consistent with their risk tolerance.
 
While diversification does not eliminate the risk of investment loss, adding assets with low correlation may soften the impact of market swings because they do not all react to economic and market conditions in the exact same manner. While it is impossible to completely eliminate risk, diversifying our client’s investments can reduce the overall volatility experienced by our client’s overall portfolio. One of the main advantages of diversification is that it makes our clients less dependent on the performance of any single asset class.
 
Market timing may improve portfolio performance.  However, it is very difficult to time the market consistently. In addition, unsuccessful market timing can lead to a significant opportunity loss.  The appeal of market timing is obvious—improving portfolio returns by avoiding periods of poor performance. However, timing the market consistently is extremely difficult. And unsuccessful market timing, the more likely result, can lead to a significant opportunity loss.  We, therefore, don’t attempt to time the market. 
 
Mitigating the impact of expenses, taxes & inflation on our client’s portfolio is important since the adverse effects of higher costs can become more pronounced over time.  Being sensitive to portfolio expense charges, deciding upon the appropriate placement of investments within taxable and tax-deferred accounts, triggering tax losses to offset capital gains and identifying other tax saving strategies can significantly improve our client’s probability of achieving their objectives.


Read our Portfolio Design section.



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