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Our Philosophy

Investment Philosophy

Our investment philosophy is different than most investment advisors. Our primary goal is to help reduce risk. Making money during good times is important, but it is perhaps more important to preserve your money during bad times.

Investment strategies need flexibility to respond to changing market conditions.
Our approach is designed to participate when market conditions are favorable, but help reduce risk when they are not. We know that over the very long term, the market has historically exceeded its old highs. The big question is how long will it take? Unfortunately, a market decline of 50% requires an investor to realize a 100% gain just to get back to even. Minimizing portfolio declines in down markets is critical because it leads to a faster road to recovery.

Buy-and-hold investment strategies are outdated.
Buy-and-hold is a traditional approach that most investment advisors and financial planners recommend. It is based on the assertion that markets work in the long run. For example, many advisors believe stocks outperform bonds and taking this extra risk is rewarded with extra return in the long run. You need to have the faith, patience and discipline to stay the course. Asset allocation, diversification and rebalancing are key principles of this type of approach. Buy-and-hold suggests riding the market roller coaster even during painful bear markets such as 2000-2002 and 2007-2008. This type of strategy can be an emotionally draining experience even for experienced investors.

Forecasting the market is nearly impossible.
Instead, we follow important long-term market and economic trends. Day to day volatility and the 24 x 7 news cycle makes it difficult to see long-term trends. However, if you step back far enough these trends are identifiable. They are vital in helping assess market risk and determine the appropriate investment strategies.

Investments require constant attention.
Markets are too volatile to employ a passive approach. We actively monitor your account and make adjustments to your portfolio based on market conditions and opportunities, not based on the calendar. We don't see the value in paying an advisor to simply buy-and-hold and rebalance a portfolio quarterly or annually.

Compensation Philosophy

We are primarily a fee-based investment advisor. Our success is linked to the success of client’s investment portfolios. We are not compensated by the frequency of trading. When we make a recommendation it is to reduce risk or increase return.

Investing involves risk including the potential loss of principal. No investment strategy, such as asset allocation or diversification, can guarantee a profit or protect against loss in periods of declining values. Past performance is no guarantee of future results. Please note that rebalancing investments may cause investors to incur transaction costs and, when rebalancing a non-retirement account, taxable events will be created that may increase your tax liability. Rebalancing a portfolio cannot assure a profit or protect against a loss in any given market environment.