A: Our customized Separately Managed Account portfolios are constructed with the client’s investment objectives and risk tolerance in mind. Portfolios can be growth, which is an equity-only portfolio, aggressive growth, which is an enhanced equity-only portfolio, growth and income, an equity-only portfolio including growth stocks and dividend paying stocks, balanced, which is a portfolio of equities and fixed income securities, or a fixed only portfolio.
Portfolios can be domestic, international or a combination of the two. In the case of international equities and fixed income, we can use mutual fund instruments or ADRs.
When creating a portfolio we primarily consider the following factors: risk tolerance, growth objectives, current income requirements, and investment time horizon.
By employing a strategic asset allocation process, we form an appropriate blend of equities, fixed income and cash or equivalents. The aim of this process is to maximize long-term performance while minimizing volatility. We review our asset allocation on an annual basis at a meeting with the client. Of course, market conditions may require rebalancing of the portfolio to remain in compliance with client’s asset allocation.
For balanced portfolios, fixed income securities can provide a reduction of risk, reduce volatility and generate interest income. We may invest the fixed income portfolio in a diversified portfolio of fixed income funds.