We customize each client’s strategic asset allocation based on their long-term objectives and risk tolerance. We will further customize the allocation of different accounts to tie into the overall allocation based on taxes, time horizon and other factors.

We use tactical asset allocation to take advantage of short-term market opportunities and rebalance each client’s total portfolio, while managing cost through low turnover and smart tax-impact choices.

A diversified investment strategy provides opportunity for extra return and helps lower the risk of the overall portfolio. Most client portfolios hold 30-40 stocks representing a broad range of sectors.

Based on our in-house research, we identify stocks of established companies with good income and earnings potential that are trading below their intrinsic value. Buying “low” builds in a margin of safety that favors potential for upside gain and protects against downside surprises.

This helps us capture positive returns, harvest tax gains and losses, and manage portfolio risks like overconcentration. We will sell a security—always with tax implications in mind—when any of the following conditions are met:

• Appreciation creates an outsized position in the client account.
• Company fundamentals deteriorate.
• Earnings potential no longer justifies price.
• Analysis uncovers “stock warning signs.” See sidebar.
• Better opportunities exist.

Low portfolio turnover—about 25% in most client accounts—helps keep costs down. We use year-round tax loss harvesting and other tax-sensitive investment strategies to help our clients manage their year-to-year tax objectives.