Investment Planning
Our investment planning services are based on our philosophy:
We are not bullish, we are not bearish, we are process.
We can’t control the ups and downs of markets, but we can rely on our disciplined investment processes to provide well-designed, tax-efficient, globally diversified investment portfolios that suit our clients’ individual needs.
The systematic processes that guide our investment decision making are intended to take the emotion out of investing and provide clients with peace of mind.
Our investment planning services complement our comprehensive financial planning – helping you put your savings to work in a way that is suited to your unique financial goals.
Our Investment Planning Philosophy
We Are: Asset Allocators
We divide your investments among diversified mutual funds and exchange-traded funds (ETFs) that include stocks, bonds, and alternatives to create tax-efficient, globally diversified, risk-focused portfolios.
We Embrace: Active and Passive Fund Management
We employ active and passive funds, selecting active managers we believe have an edge. Cost is always a factor but does not solely drive our fund selection process.
We Have: A Commitment to Research
We regularly monitor public and private sources of information to stay well-informed about securities markets and the impact of macroeconomics.
With the abundance of news sources available, we maintain a focus on select information providers, including maintaining private subscriptions to unbiased sources unaffiliated with any bank, brokerage, or mutual fund company.
We Help: Develop Investment Objectives
We maintain asset allocations suited to individual investment objectives from conservative to aggressive – taking into account your time horizon, risk tolerance, and risk capacity levels.
We Provide: Diversified, Tax-Efficient, and Low-Cost Portfolios
We manage six investment portfolios that include options for larger and smaller asset values, as well as an environmental, social, and corporate governance (ESG) mandate.
We know everyone’s situation is unique, and we have the flexibility to modify portfolios to accommodate your specific planning priorities.
Our Investment Planning Processes
Monthly Investment Committee Meetings
Our investment committee meets on a monthly basis to create and maintain firm-wide investment policy, processes, and standards.
The committee performs in-depth reviews of the global economic environment, our portfolio construction, investment performance, and fund selection.
Weekly Portfolio Drift Monitoring
Client investment portfolios are monitored each week to determine drift from target allocations. Portfolios that drift more than 5% are reviewed and traded back into alignment with their target allocations when appropriate.
Market Dislocation Planning
If markets move up or down beyond a pre-determined threshold, we review market conditions and portfolio impact to determine if rebalancing is recommended. This allows us to strategically buy low and sell high, while maintaining asset allocation targets.
Regular Portfolio Review
Our comprehensive portfolio reviews are designed to highlight opportunities for portfolio improvement. Our reviews include detailed analysis of portfolio construction, performance attribution, fund selection, and capital market assumptions.
Systematic Tax Management
We review portfolio holdings to optimize tax allocation, execute tax gain or loss harvesting, and monitor holdings for tax efficiency.
Personalized Portfolio Updates
Portfolios are reviewed at client meetings to provide updates on performance and investment strategy. Changes to personal financial situations may affect asset allocation, fund holdings, or cash management.
Strategic Cash Management
Cash management has become increasingly important due to higher interest rates. We maintain efficient processes to invest and distribute cash balances in accordance with each client’s needs.
Special Situation Strategies
Our investment processes include strategies to manage special situations including but not limited to:
- Concentrated stock holdings
- Company stock options and restricted stock
- Retirement plan investments
- Non-U.S. residents
- Low-basis holdings
- Use of margin debt
- And other specialized investment strategies
Investment Planning Resources
Looking to learn more about investment planning? Explore these insights from our team:
- Investment Management vs. Financial Planning: What’s the difference?
- Asset Location Strategies: A Framework for Reducing Investment Taxes
- 8 Tips for Investment Diversification
- What Are the Elements of Financial Risk?
FAQ
What is investment planning?
Investment planning is the process of building and managing a portfolio designed to help you reach long-term financial goals. It involves decisions around asset allocation, diversification, risk management, and tax efficiency, all based on your time horizon and financial objectives.
How should I invest based on my risk tolerance?
Your investment strategy should reflect how much risk you can handle both financially (known as risk capacity) and emotionally (known as risk tolerance). More aggressive portfolios typically include a higher allocation to stocks, while more conservative portfolios focus on bonds and cash. The right balance depends on your goals, timeline, and comfort with market fluctuations.
What is asset allocation and why does it matter?
Asset allocation is the way your investments are divided across different asset classes like stocks, bonds, and alternatives. It is one of the most important factors in long-term investment performance because it helps balance risk and return across different market conditions.
Should I use active or passive investment strategies?
Both active and passive strategies can play a role in a diversified portfolio. Passive investing typically focuses on low-cost index funds, while active management aims to outperform the market. Many investors benefit from a combination of both approaches depending on their goals and preferences.
*Please Note: Limitations. Different types of investments involve varying degrees of risk. Therefore, it should not be assumed that future performance of any specific investment or investment strategy (including the investments and/or investment strategies recommended and/or undertaken by Affiance Financial) will be profitable, equal any historical performance level(s), or prove successful.
All investment strategies have the potential for profit or loss. Asset allocation, rebalancing, and diversification do not ensure or guarantee better performance and cannot eliminate the risk of investment losses. Affiance Financial only conducts business in states where it is properly registered or is excluded from registration requirements. Registration is not an endorsement of the firm by securities regulators and does not mean the adviser has achieved a specific level of skill or ability.
Affiance Financial and PCS are not engaged in the practice of law or accounting. Always consult an attorney or tax professional regarding your specific tax situation.
