Investment Approach
When constructing portfolios, we focus our attention on time-tested, sound investment practices. This results in high-quality, prudent and individually-built portfolios:
Appropriate diversification: No single holding should have undue influence on the overall portfolio. This means that we will recommend holding a diverse assortment of securities to ensure that we are limiting risk in the portfolio. We also take into account the historic volatility of any individual security, and how it impacts on the risk profile of the portfolio.
An emphasis on cash-flows: History tells us that a very large proportion of total returns stem from the cash flows generated by the securities we hold. We believe that companies that pay a healthy, stable, and sustainable dividend to their shareholders are more likely to yield strong returns over time for investors.
A portfolio approach: Investment decisions should be made in the context of the entire portfolio. A client’s financial plan feeds into our overall asset allocation recommendation, and a client’s tax situation impacts on our recommendation for how each individual account is structured. Every recommendation we make looks not only at the quality of the individual security but also at its impact on the portfolio as a whole.
Review and rebalancing: The construction of a portfolio is an important step, but its ongoing maintenance is critical. From time to time, it is appropriate to make changes to the asset allocation of a portfolio, either as part of the financial planning process or proactively based on the evolution of financial markets.