Measuring and managing diversification is the light to the path.
In the beginning . . .
The problem . . .
The evolution . . .
Diversification intelligence . . .
Improves portfolio stability.
Strategies and Portfolios to Meet Your Needs.
Intelligent Portfolios with Better Balance _____________________________________________________________________ Recent advances in identifying and measuring investment diversification deliver richer information content about a portfolio's stability under different market conditions. For investors who are counting on their portfolios to replace their earned income and sustain them in retirement, this richer information content offers significant opportunity to build a safer, better-balanced portfolio of investments.
Our core expertise is building and managing investment portfolios with better balance. An investment portfolio with better balance enhances portfolio stability and capital preservation. It also helps extend a portfolio's retirement distributions and helps reduce investor stress and fatigue during bad market environments.
While the premise of investing is to increase your wealth, identifying and purchasing assets that grow in value over time is not enough. This is because positive returns from risk assets do not materialize on schedule and sometimes they do not materialize at all. ____________________________________________________________________
Building portfolios with better balance enhances portfolio stability and capital preservation, helps extend a portfolio's retirement distributions and helps reduce investor stress and fatique during bad market environments. ____________________________________________________________________ It is very counter-intuitive to desire some investments in a portfolio to periodically decline in value. This makes sense though when one stops to think about it. Since no investment is always constantly rising, better portfolio balance can be achieved when combining investments that do indeed increase in value over time, just not in lockstep with one another.
Asset Allocation. Asset allocation is an investment strategy that guides portfolio construction from the risk and return characteristics of different assets. The idea is to invest in a combination of various assets with dissimilar price behavior in order to diversify and reduce overall portfolio risk.
Risk cannot be adequately measured. Risk is most often described using statistics of normal probability, but risk by its nature is not normal and does not lend itself to quantification because it must include that which cannot be measured, carrying an extreme impact that cannot be predicted.
Diversification Allocation. Instead of combining various assets in an attempt to ''manage'' risk, we spend the allocation decision on combinations of assets that improve portfolio balance through better diversification benefits. We use patented diversification identification and measurement technology to develop this diversification intelligence.
The graphs below cover the same timeframe. They illustrate the improved balance in asset price behavior and the associated improvement in the overall stability of a portfolio using the richer information content that we glean from identifying and measuring diversification. Then we develop diversification-weighted allocation strategies that work to reduce downside portfolio risk while you seek the investment returns you require.
Asset Price Behavior Asset Price Behavior Using Asset Allocation Using Diversification Allocation
More Downside Portfolio Risk Less Downside Portfolio Risk
The math of successfully compounding higher long-term investment returns favors portfolios with less downside risk. To accomplish this, we work to measure and capture true volatility-reducing diversification benefits within each client portfolio. _____________________________________________________________________
The bedrock of our investing approach is to help our clients meet their planned cash needs, achieve consistent asset growth, avoid unrewarded risks and control their tax and investing costs. _____________________________________________________________________
Regardless of your specific cash flow requirements, you have a need to achieve consistent asset growth; if not to increase your base of assets to more successfully meet your future needs, then to preserve the purchasing power of your assets. There is no paper currency in the history of the world that has preserved its long-term purchasing power.
Once we understand your need for cash flow and capital growth, we apply our research in the form of distinctive empirical strategies that have more stable expected returns within your risk tolerance and risk capacity.
Our goal is to generate investment returns that help you meet your needs and objectives. This helps free you from chasing irrelevant institutional benchmark index comparisons that provide little context in helping you understand the success or failure of your investment plan.
