Our Investment Philosophy
We believe in broad diversification as we seek to optimize risk and return and we manage your portfolio with income tax efficiency and cash flow considerations in mind. Our investment philosophy is grounded on objective, academically based models that minimize market forecasting or prognostications.
Based on our thorough initial data gathering, we develop a complete picture of your current financial situation, your investment return needs and expectations, and your risk tolerance. With this information in hand, we’re able to develop an investment portfolio designed as we believe necessary to achieve the returns you need to reach your longer term goals while also minimizing your risk. Because we believe that cash flow is a major determinant of financial success, we strive to develop a plan that generates the necessary cash flow to sustain your desired lifestyle over the long term.
Total Portfolio Approach
We use an asset allocation and asset location strategy to integrate and coordinate all of your family accounts, including:
- Single, joint and trust accounts
- Custodian accounts for minor children
- 529 college savings plans
- Traditional or rollover IRAs
- Roth IRAs
- 401(k), profit-sharing or employer plans
- Non-qualified retirement plans
- Employer stock options
Broadly Diversified Portfolio
We are strong believers in diversification and use a “multi-asset class” strategy for diversification. Investments may include:
- U.S. stocks, diversified by size and investment style
- International and emerging market stocks
- Real estate investment trusts
- Low-volatility investments
- Corporate, government or municipal bonds
- Inflation-protected bonds
*BFMI generally utilizes mutual funds as the primary investments vehicle for client accounts.
Risk and Return Are Related (The 3 Rs)
Every investor wants a low-risk portfolio but low returns may not enable you to reach your goals. The return needed to meet your goals may require a higher level of risk.
Minimize Fund Fees, Expenses and Income Taxes
All other things being equal, lower costs and lower taxes mean higher net returns. We cannot control stock market conditions or interest rates, but we can add value by seeking to minimize costs and income taxes. Net returns are what count.