investment planning

All or Nothing

© Can Stock Photo / agencyby

We keep hearing reasons why financial advisors should have 100% of every client’s invested assets, instead of some fraction. This theory is popular with… financial advisors.

You might guess we have a contrarian opinion on this subject, like most subjects. Our theory is that we end up with all the business we deserve. Since you who own the money are the judge of that, we are relieved of the burden of worrying about it. We don’t want any money in our shop that doesn’t want to be here, after all.

There are sound reasons to consolidate assets in one place – including lower costs through volume discounts. But some may prefer not to do that, for whatever reason.

Our investment approach is different than most. Rather than use the standard pie chart approach of owning a little bit of everything, or outsourcing investment management to some third party somewhere, we do hands-on research and our own thinking, using individual securities as appropriate. So our work is a useful diversification, something different, from run-of-the-mill conventional portfolio management using investment products instead of stocks and bonds.

When somebody wants to allocate a fraction of their wealth to our care, it is fine by us. We already know how much business we will ultimately end up with: all that we deserve.

It turns out that remembering whose money it is not only respects the people who engage with us, but also reduces our stress.

Clients, if you would like to talk about this or anything else, please email us or call.


Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.

All investing involves risk including loss of principal. No strategy assures success or protects against loss. There is no guarantee that a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk.

20/20 Foresight

© Can Stock Photo / leolintang

The New Year is upon us. Like Opening Day of baseball season, the first day of school, or any other beginning, it is a good time for plans and planning.

We’ve been able to focus on strategic issues in recent weeks, ones that will shape our work for you in the years to come. The general theme? Build an enterprise that will serve you well, and be durable enough to outlive me.

While we work ON the business, of course, we also need to work IN the business, taking care of things for you. Fortunately, we know exactly what the stock market and the economy are going to do: go up and down, same as always. Time tested principles and strategies will always be the foundation of our work with you. They do not eliminate the ups and downs, but they improve the odds we will survive them and come out on the other side.

The items on our list are wide ranging. The more significant ones: finding and developing more good people to join the team, figuring out office space, determining whether we need to form our own Registered Investment Advisor, guiding the evolution of our offerings, and building a more robust financial planning process.

But enough about us. What about your strategic issues? If you want to talk about retirement, changing where you live, sorting out who should get what after you are gone, or simply where to invest for the long run, email us or call.

The Ant and the Grasshopper, Revised

© www.canstockphoto.com / smithore

Most of us are familiar with Aesop’s fable of the ant and the grasshopper: the hard working ants slave away all summer building nests and storing food while the lazy grasshopper idly eats and makes merry. Each one calls the other foolish: the grasshopper tells the ants they should relax and enjoy life, while the ants admonish the grasshopper to work harder and prepare for winter. In the end the ants have the last laugh when winter comes and they have food and shelter while the grasshopper has none.

It should be noted that Aesop was not a bug expert. If he was, he might have realized that grasshoppers only live a few months and do not survive long enough to even see winter. Knowing this, the grasshopper was actually quite wise to ignore the ants’ advice. He lived his life to the fullest, with no time wasted on unnecessary labors.

The true moral of the story is this: it is equally foolish to hoard wealth we’ll never use as it is to squander wealth that we’ll need in the future.

None of us knows the date that is going on our death certificate. We should strive to emulate both the ant and the grasshopper, because we never know which one we’ll wind up as. Like the ant, we should work hard and save wisely to prepare for the future. But like the grasshopper we should also enjoy what we have, while we have it. We need to have a little fun every day, because we never know how many days we have left.

What To Hold For Your End Of The World Portfolio

Man worried about 2012 doomsday prophecy - Stock photoOur entire investment philosophy is underwritten by a simple fundamental belief: tomorrow will be better than today. We can’t know that this will be true of every single tomorrow, but we’re pretty sure of what the long term trend will be.

Though they say that “past performance does not guarantee future results”, human civilization has a track record thousands of years long of managing to always do bigger and better things. We expect that things will continue to get bigger and better as time goes on. Without this belief the idea of investing in the future is meaningless.

We know that there are troubles in the world, as the news frequently reminds us. Clients sometimes come to us fearing that the latest bad news signals imminent total catastrophe. This isn’t anything new–people have been predicting the end of civilization for the entire span of human history. Yet somehow we’ve always gone on to bigger and better things all the same.

If such things ever do come to pass, it isn’t going to matter what investments you own. Your meanest neighbor will be trying to steal your canned goods. So the ideal portfolio for the end of the world is the one that will serve you best in the event that the end of the world fails to show up on schedule—again.