Investment Strategies

Are you using traditional approaches to investing?

We believe there are a number of principles that have proven through time to be effective at guiding successful investment decisions.

The Four Keys to Investing for Success is:

Clients’ priorities typically fall in this order:

1. Understanding Your Investment PHILOSOPHY – Knowing what you own and why you own it can only be accomplished by a limited number of holdings, as owning additional stocks takes away the potential of big gainers significantly impacting your bottom line. It is the same case with large mutual funds investing in hundreds of stocks. According to Warren Buffett: “Wide diversification is only required when investors do not understand what they are doing”.
   Bottom-line... Understand your Philosophy!
2. Executing Your Investment STRATEGY – Many would say my investment strategy is centered on the concept of attempting to lower volatility (defined as risk) as much as possible. At the end of the day, increased volatility simply creates a situation in which the market lows are lower, thereby making the investment process more effective. Hence greater volatility can equate to greater returns.
   Bottom Line... the volatility of the stock market isn't just something you have to put up with in order to earn superior returns; it's actually an essential factor that directly improves your returns.
3. Allowing for Unfettered FLEXIBILITY - Are you or your money manager constrained to a certain benchmark, peer group or prospectus objective? Style boxes are now widely used to construct and monitor portfolios — they were designed to evaluate and monitor investments not to be a rigid framework for asset allocation. Research indicates that managers constrained by style boxes under- performed “unconstrained” or more flexible managers.
   Bottom Line... Flexibility allows for tax efficient management of a portfolio where applicable and Managers that focus on philosophy and strategy-based investing rather than an arbitrary “style-box” have greater flexibility and provide higher returns with lower volatility over the long term.
4. TRANSPARENCY – Do you know which companies you own in your portfolio? As an investor in a company's stock you are an owner of that business. A vast majority of investors have no idea what their number one holding is, let alone the several hundred or thousand other holdings they may own. We believe that there is nothing worse than not knowing what you own and why you own it.
   Bottom Line... investors as shareholders have left the confines of being an owner in a business to a speculator using fear and greed (because they do not know what they own and why they own it) to drive their investment decision-making process.