We are guided in managing your investments by these three central principles:
We believe that to find the best performing stocks, the investment with the highest return or the sure-thing corporate bond is a losing game. Many brokers and advisers draw you in with promises of high returns and great performance. They can't deliver! The overwhelming body of academic research shows that active managers, be they stock brokers, pension fund managers or investment bankers, don't do as well as the average of the entire stock market. Furthermore, the few who do outperform the market in any given year rarely do the same the next year. Trying to pick the best stock or best fund is NOT a strategy that works!
How about those who say they can generate great returns with careful decisions about when to buy or when to sell the investments they manage? These are the market timers. This has also been shown in study after study to be a management approach doomed to failure. Because the incredible speed with which information is disseminated these days and because of enforcement of the laws banning trading on inside information, everyone in the market has the same information about a given investment. And because everyone has the same information, no one can benefit from knowing just the right time to buy or sell. It's a loser's game (except if you're the broker making the commissions).
We do believe that the best way to achieve consistent returns from your investment portfolio is to manage the risk rather than try to achieve extraordinary returns. We try to find a portfolio that fits your risk profile along three axes - your need for risk, your willingness to accept risk and your ability to take risk. We spend a good deal of time helping you assess these measures. Furthermore, we can show you that a lower-risk portfolio can typically result in greater value than another with equal average returns. We seek diversification of your investments - knowing that some segment of the investment universe will be the winner this month and we want you to be there!1 We are constantly trying to keep your costs down. That includes your trading costs, management costs and tax costs. And we follow a disciplined and reasoned approach that seeks to keep your portfolio balanced. It's an approach that results in buying when prices are down and selling when prices are up - buying the losers and selling the winners - buying low and selling high. We'd love to show you how it works.
Though we can accommodate you with other compensation arrangements, our preference is to do business with you on a fee-only basis.2 That means we collect no commissions when you buy or sell securities and we have no incentive for you to trade. Rather, you pay a quarterly fee based on the size of your portfolio that covers all of your costs for management and for trading. Our only incentive is to see your portfolio grow.
Let us manage your investment portfolio. We believe our approach is one that can really help to achieve long-term growth.