An Investment Strategy for Volatile Times
At Kanaly, we believe our fiduciary duty to our clients mandates that we design a portfolio strategy to prosper in our current challenging environment.
A mature global economy (particularly in developed markets), credit market stress, high levels of debt and commodity price inflation are a few examples of the factors which have contributed to the challenges investors are currently experiencing. In fact, the S&P 500 has actually lost money over the past 10 years.
To carry out our process, we incorporate investment experts that employ a broad range of strategies, rather than relying solely on our own expertise. As a fiduciary, it is not only prudent, but imperative that we offer these solutions to our clients.
In addition, recent innovations have afforded the opportunity to offer institutional-quality solutions to our clients. Of course, individual investors are different from institutions - individuals pay taxes, typically have shorter time horizons, and require significant customization. But individual investors can and should take advantage of the benefits of these solutions - specifically, a well-defined investment philosophy and process, a focus on risk management, and disciplined portfolio construction.
Kanaly's Investment Philosophy
The foundation of our investment philosophy dictates that compounding positive returns is the key to maximizing and preserving wealth. This requires greater diversification, a focus on reducing volatility of returns, and protecting capital in down markets. Key components of our philosophy include:
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Constructing ultra-diversified portfolios comprised of uncorrelated assets
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Utilizing four broad asset classes: equity, fixed income, inflation protection and real estate
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Making use of both traditional long-only and alternative investment strategies
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Accessing the best and brightest investment talent
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Using tax-efficient and less liquid strategies only as appropriate
At Kanaly we use a combination of passive and active management to maximize value relative to management fees. Passive strategies typically have a very low cost and track indexes such as the S&P 500 to provide efficient economic exposure to the market.
For taxable clients, we include index strategies that actively harvest tax losses, thereby efficiently maximizing after-tax returns. Active managers attempt to exploit market inefficiencies to beat indexes, yet charge a higher fee than those who utilize passive strategies. We have identified a group of active managers that have added value for our clients that exceed market averages, both in terms of investment returns and risk management. In those instances, an active management fee is justified.
Finally, all of Kanaly's investment recommendations are made based on objective advice, free from the conflicts of interest so often found in the financial industry. Our goal is to find the best investments for our clients, at the best price. Integrated with our core competencies in comprehensive financial planning and trust and estate services, Kanaly's wealth management platform is positioned to achieve our clients' goals.
Learn how we can help you to achieve your goals.
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