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What Kind of Portfolio Performance Can I Expect?

If you’re looking for an advertisement about investment miracles, “market beating returns” and Warren Buffett type performance then you’ve come to the wrong place. We don’t sell “alpha” or market beating returns and we don’t believe most investors should waste their time trying to beat the market. Instead, we view your portfolio as a “savings portfolio”. We focus on building the appropriate portfolio for you as opposed to selling the hope of market beating returns in exchange for the guarantee of high fees, as is so common in this industry.

Our approach is designed to maintain parity between your risk profile and its underlying asset holdings over the course of the changes in the business cycle. In doing so, we focus on growing your savings and protecting it from inflation while also protecting it from the risk of permanent loss. This approach smooths returns and helps to establish stability in your portfolio so you can more easily plan for the unpredictable future. Most importantly, we focus on maintaining parity between your risk profile and the relative risks of the underlying asset classes. That is, while your risk profile will remain the same over the course of the business cycle, the risk exposure will actually change as various asset classes change in price and expose you to different degrees of risk.

Because of this approach we expect to underperform the stock market at points in the cycle on a nominal basis.  Over the course of the business cycle, however, we hope to generate a risk adjusted return that is superior to a benchmark portfolio.  The Countercyclical Indexing strategy is not a “beat the market” strategy.  Instead, it is designed to create a portfolio return that is more appropriate for a specific investor’s risk profile than what Modern Portfolio Theory might output.  This approach is designed to smooth out the performance of a portfolio over the course of the business cycle and match your need for financial stability with the way your portfolio of savings actually performs.

Your actual performance will depend on your personal needs and which strategy we implement for you, but this approach helps to align the client’s perception of risk with that of the underlying portfolio over the course of the changing business cycle.

* Past performance is not indicative of future returns and this data should not be misconstrued as future performance.  This is merely a hypothetical designed to provide perspective on what the cyclically adjusted approach is designed to achieve.  Please do not misconstrue this as actual performance or an accurate representation of actual performance.