Web News

Investment Management Commentary

A key part of “THE FINANCIAL NAVIGATION PROCESS TM” is our recommendations in regard to portfolio construction and investment management. With a view to constant improvement, we are continually improving our investment process by using state of the art investment programs that were not available even a year or two ago.

With interest rates and bond yields at 40 year lows it is not going to be an easy decade to make money. We have a different world than we had in the 80’s or 90’s and so far this decade we have had a lethargic economy. This means that we must be more watchful and careful and have better methods of monitoring your portfolios. This is why we are introducing a wider use of “institutional managed money” and “value investing” which should provide more predictable returns over the years ahead.

Institutional investing attempts to control risk by building portfolios with scientific analysis using professional managers. This minimizes expenses and uses a very rigorous “management selection” process as well as a rigorous “manager monitoring” process. The managers will be replaced if they do not fill their mandate on an annual basis. Your money will be managed similar to a multi billion dollar pension fund and will create better and more consistent returns for you.

Value investing manages risk by building portfolios with an emphasis on purchasing solid businesses at discounted prices. Warren Buffet once said there are two rules for investing. Rule Number One is not to lose money. Rule Number Two is never forget rule Number One. All kidding aside, we believe the days for making easy money are behind us and that true value investors with their focus on providing a “margin of safety” for their clients will be well positioned going forward. We have begun a process where we are reviewing accounts to see if a change towards more value and/or institutional style investing makes sense. If you have any questions or concerns please give us a call.

Back to Web News Index