There are lots of “investment strategies”. Trying to pick individual stocks that will beat the market or trying to buy low/sell high based on the market’s performance from day to day is speculation - not strategy. Asset allocation, diversification of risk, continually seeking reduced costs and staying the course – that is managed investing – truly strategic and how we work at WWA.
The foundation of our investment philosophy is Modern Portfolio Theory (MPT), a combination of market and behavioral research. It is a time-tested, Nobel prize-winning approach that is highly valued by academic and investment professionals. Although there is no guarantee that a diversified portfolio will enhance overall returns, outperform a non-diversified portfolio or ensure against market risk, MPT proves that intelligent diversification and ongoing rebalancing of investments may minimize risk and potentially optimize portfolio performance. Using MPT, we will regularly analyze your asset allocation and rebalance your investments as the ever-changing and volatile markets demand.
Our clients benefit from our individualized investment management approach. Each portfolio is created to take advantage of:
- Proper asset allocation - determining a deliberate exposure to the various asset classes to meet your financial objectives
- Proper asset location – choosing specific types of accounts to provide the most beneficial tax treatment for your situation
- Cost management – researching ways to minimize investment cost to increase return
- Tax management - low turnover, careful harvesting of gains and losses and intelligent withdrawal planning to reduce the negative drag of taxes on your returns
- Regular rebalancing – buying and selling portions of your portfolio in order to return the weight of each asset class to its original state.
Academic studies suggest that such rebalancing can add up to 1% or more to a portfolio’s expected return. The institutional funds and exchange-traded funds we employ are selected for their disciplined adherence to asset class exposure as well as for their extremely low turnover and expense ratios.
At WWA, we believe that beating one index or another is not the true measure of success. Being able to retire comfortably, afford the college of choice for a loved one or sleep restfully during protracted market downturns are more meaningful barometers of successful investment planning.