Our Strategy

Investors face uncertainty when investing in the stock market.  Uncertainty stems from company performance, interest rate fluctuations, government decision-making, domestic and international political and economic events, natural disasters, and countless other sources.

Some Certainties.  History and experience have taught that there are some “near certainties” that investors can generally count on:

  • Market volatility.  Stock prices will fluctuate.
  • Long-term upward trend.  The stock markets as a whole (globally speaking) have experienced a slow but steady long-term upward trend.
  • It’s difficult to consistently beat the market.  Many have tried.  The vast majority fail.  There is persuasive evidence that those few investors who consistently beat the market are actually “lucky” rather than “good.”
  • Taxes.  Given the current political climate, it seems wise to plan for higher tax rates in the future.

Factors We Can Control.  While there are things we can’t control about the stock market, wise investors take advantage of the “near certainties” by recognizing there are certain factors they can control:

  • Asset allocation.  There is considerable evidence that asset allocation is the most important driver of returns.  We utilize advanced “Monte Carlo” simulation techniques tempered with experience and common sense to achieve appropriate asset allocations with periodic rebalancing.  Appropriate asset allocation and periodic rebalancing allow our portfolios to take advantage of the market’s long-term upward trend while dampening the effects of market volatility.
  • Fees and expenses.  Investing is one area of life in which the phrase “you get what you pay for” is often wrong.  Knowing what’s worth paying for, and what’s not, is an important part of the service we provide.  Most importantly, it allows us to increase our clients’ after-expense net returns.
  • Tax recognition events. One of the main benefits of investing in stock is the ability to control the timing of tax recognition events.  With stock, investors have significantly more control over the timing of tax recognition events than with most other common investments such as money market accounts, savings accounts, or Certificates of Deposit.  We are able to help our clients reduce their tax exposure by controlling the timing of tax recognition events.
  • Other tax minimization strategies. There are other tax minimization strategies available to stock market investors that generally are not available to investors in many other common instruments such as money market accounts, savings accounts, or Certificates of Deposit.  We increase the after-tax returns of our clients by employing these strategies.

How It Comes Together  We minimize the effect of market uncertainties by applying optimized strategies in those areas we can control.  Our approach increases our clients’ after-tax returns by:

  • Establishing an appropriate asset allocation and rebalancing strategy to maximize return for a given amount of risk.
  • Minimizing fees and expenses.
  • Minimizing tax by controlling the timing of tax recognition events and employing other tax minimization strategies.

If you would like to learn more about our strategy, contact us by email or toll-free telephone.