Asset Allocation

Asset allocation is the process of selecting a mix of asset classes that closely matches an investor’s financial profile in terms of their investment preferences and tolerance for risk.  It is based on the premise that the different asset classes have varying cycles of performance, and that by investing in multiple classes, the overall investment returns will be more stable and less susceptible to adverse movements in any one class.

All investments involve some sort of risk, whether it’s market risk, interest risk, inflation risk liquidity risk, tax risk. An individualized asset allocation strategy seeks to mitigate the risks of any one asset class though diversification and balance. We believe that a portfolio is only as strong as its core.  Finding the right core to build on gives one the security of knowing that the portfolio can weather the ups and downs of the financial markets.


Individual Strategy

Carien and Betsy believe that an investor’s allocation of assets will reflect his or her desired goals, priorities, investment preferences and risk tolerance. Asset allocation is an individualized strategy, so there really is no perfect mix of assets.  Each individual’s strategy is built on the careful consideration of the key elements of their financial profile:

Investment Objectives: What it is the investor hopes to achieve using his investment dollars – improve current lifestyle; achieve capital growth; fund a specific goal, such as a college education

Risk Tolerance: This reflects the investor’s comfort level with market fluctuations that can result in losses.  Inflation risk and interest risk need to be considered as well.

Investment Preferences: An investor may prefer one asset class over another based on a certain bias or interest towards the characteristics of that class.

Time Horizon: The length of time an investor has to commit to achieving an objective. There can be different time horizons for varying objectives.  A retirement plan would be a long term plan vs an education plan which might only be 18 years or less.

Taxation: Investing in a mix of asset classes will have varying tax consequences. Both Matt and Carien have years of experience in personal tax planning and preparation and we integrate this with your investment plan.  As it is what you get to keep as much as what you make on your portfolio that creates your future lifestyle.