Constructing An Investment Strategy

Wealth advisors work with clients to identify the most appropriate asset allocation to achieve their investment objectives. Asset allocation requires an understanding of client specific issues and consideration of the economic and market environment. Most importantly, a disciplined approach reflects a longer-term investment focus that seeks to achieve consistent, risk-adjusted after-tax returns over time. Expert analysis yields a customized investment strategy tailored to a client’s specific objectives. The firm allocates assets across four major categories: equities, fixed income, alternative investments and cash.

Equities are part of the growth component in a portfolio. An equities portfolio should be well-diversified by capitalization (e.g., large and small cap stocks), geography (e.g., international and domestic stocks) and style (e.g., core, growth, and value stocks).

Fixed Income is the foundation of an investment portfolio, providing predictable, steady cash flow with lower risk of capital loss.

Alternative Investments include vehicles such as hedge funds, real assets (such as energy and real estate) and private equity. They are generally less liquid than equities or fixed income, offer returns that are potentially less correlated to the public equity and fixed income markets and have the potential to achieve higher returns. Adding investments with low correlation to other strategies in a portfolio generally reduces the volatility of portfolio returns.

Cash allocations are most appropriate for situations demanding high levels of liquidity. Cash investments include simple money-market funds with attractive yields, floating-rate municipal instruments, discount U.S. agencies and other short-term fixed income securities.

A customized solution is constructed from a range of strategies and services provided by Bel Air and other proven organizations.