Investment management is a key component of financial planning and wealth management. Our baby boomer retirement specialists understand how to develop financial models and investment strategies that support a client’s goals and objectives. Using the Nobel Prize winning Modern Portfolio Theory of Asset Allocation (MPT) and adjusting for an individual’s timeline and risk tolerance, we make recommendations that seek to perform well in both good and bad markets, striving to provide the highest return for the least amount of risk.
The goal of diversification is not simply to have many different investments, but to combine complimentary investments. A well-diversified portfolio consists of asset classes that are not closely correlated to each other. For example, real estate investments may go up when blue chip stocks are going down. The addition of less correlated assets to a portfolio is designed to produce a more stable overall portfolio, and to spare clients the roller coaster ride that is associated with emotional extremes and poor decision making.
We are an independent investment advisor, having no proprietary products. That means our only loyalty is to our clients and our sole objective is to provide the best possible portfolio advice to every one of them.
Below are examples of different asset class models that may be used:
Capital Preservation - 100% Fixed Income
For the most conservative investor and those needing to maximize their current income while maintaining the value of their portfolio. Short-term investors should use this strategy to maintain their principle while meeting their needs for income. Investment choices are basically fixed-income vehicles.
Conservative - 76.5% Fixed Income/23.5% Equities
For investors with a primary interest in current income, but with a need for some growth in their portfolio. This strategy combines both long- and short-term government bonds with balanced income investments and some equities to help keep pace with inflation.
Moderately Conservative - 59.5% Fixed Income/40.5% Equities
For investors seeking a bit more growth than that of the conservative portfolio but wanting to maintain a conservative overall portfolio. This strategy features an increase in equity exposure that is about half-way in between that of the conservative and moderate portfolios.
Moderate - 60% Equities/40% Fixed Income
For investors seeking a moderate investment approach for retirement or with a shorter (less than five years) objective. This strategy is designed for those investors seeking preservation of capital, along with some income and modest growth. This strategy balances domestic and international stocks and bonds.
Moderately Aggressive Growth - 77% Equities/23% Fixed Income
For investors seeking optimum long-term growth with a minimum five-year time horizon. This approach is designed for those willing to accept a substantial degree of volatility to achieve their goals. United States and international equities are targeted with this strategy.
Aggressive Growth - 100% Equities
For investors seeking maximum long-term growth for retirement or other financial goals. Investors must be willing to accept high volatility and potential substantial investment fluctuations to achieve their goals. Results are sought through a diverse mixture of growth-oriented and small company stocks, as well as international equities.
Investing involves risk including the potential loss of principal. There is no guarantee that a diversified portfolio will outperform a non-diversified portfolio in any given market environment. No investment strategy, such as asset allocation and rebalancing, can guarantee a profit or protect against loss in periods of declining values. Past performance is no guarantee of future results. Please note that individual situations can vary. Therefore, the information presented here should only be relied upon when coordinated with individual professional advice.
In general, the bond market is volatile, bond prices rise when interest rates fall and vice versa. This effect is usually pronounced for longer-term securities. Any fixed income security sold or redeemed prior to maturity may be subject to a substantial gain or loss.
International investing involves special risks including greater economic and political instability, as well as currency fluctuation risks, which may be even greater in emerging markets.
Investments in stocks of small companies involve additional risks. Smaller companies typically have a higher risk of failure, and are not as well established as larger blue-chip companies. Historically, smaller-company stocks have experienced a greater degree of market volatility than the overall market average.
Investors should understand that investing in strategies that are non-correlated to the stock and bond markets are not without risk. There can be no assurance that alternative investments will be profitable and will even outperform asset classes correlated to the stock and bond markets. These strategies are not suitable for all investors. Investors should be aware that alternative investments may be subject to certain fees, create taxable events, may be illiquid as well as the fact that no secondary market may exist.