Investing Approach
Key Tenants:
- Don’t Try to Beat the Market
- Capture Market Rate of Returns
- Minimize Trading Cost
Global Structured Investing Approach is based on:
- 80+ years of financial market data
- Nobel Prize-winning economic research
- In-depth studies of investor psychology and behavior
Efficient Markets Hypothesis — 1965
Eugene F. Fama, University of Chicago
- Based on extensive research on stock price patterns
- Current prices incorporate all available information and expectations
- Current prices are the best approximation of intrinsic value.
- Price changes are due to unforeseen events
- Mis-pricings do occur but not in predictable patterns
Behavior of Securities Prices — 1965
Paul Samuelson, MIT (1970 Nobel Prize in Economics)
- Market prices are the best estimates of value
- Price changes are random
- Future share prices are unpredictable
There are five key concepts that play a vital role in the construction of all Global Structured Investing portfolios:
- Accept Market Efficiency
- Take 3 Risks Worth Taking
- Effectively Diversify
- Customize Your Portfolio
- Exercise Patience & Discipline
Global Structured Investing Approach
Don’t Try to Beat the Market
- Active management cannot consistently add value through security selection and market timing
Capture Market Rates of Return
- We seek to capture market rates of return by investing in large numbers of stocks in selected asset classes, resulting in portfolios with thousands of stocks
- Exclude Certain Groups of Stocks with Heightened Risk or Inefficiency
- We exclude new stocks (IPOs), financially distressed and bankrupt companies, and illiquid stocks
Minimize Trading Costs
- We own representation in the selected asset classes and hold onto them, rather than frequently buying and selling
- We don’t attempt to track indexes as this can result in significant trading costs
- Our portfolio managers have flexibility on when to add or remove individual stocks from asset classes
We offer a complimentary and confidential private briefing meeting.
Call to schedule an appointment (240) 395-4455
