How we implement and monitor it:
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EVALUATE CURRENT SITUATION AND OBJECTIVES
- Review the current portfolio strategy and investments
- Determine client goals
- Determine appropriate return and risk objectives
- Evaluate income needs
- Provide education about investment alternatives and financial markets for the family
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DEVELOP ASSET ALLOCATION STRATEGY
- Focus on creating diversified portfolio
- Evaluate various asset allocations for return, risk, and income characteristics
- Model short- and long-term portfolio growth and risk
- Consider effect of current market conditions
- Determine best allocation of asset classes, investment strategies, and styles
- Develop tax-efficient approach, when appropriate
- Create investment policy statement
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CONDUCT INTENSE DUE DILIGENCE AND SELECT MONEY MANAGERS
- Select investment managers:
- Review quantitative and qualitative data
- Perform initial analysis to determine interest
- Conduct in-person manager interviews
- Perform reference checks
- Monitor asset manager performance before investment
- Submit final analysis and proposal to investment committee
- Employ equity managers with a bias toward “value” style and bottom-up fundamental analysis
- Employ dedicated investment team to identify, select and monitor managers
- Acquire approval by seasoned investment committee
- Select investment managers:
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IMPLEMENT INVESTMENT PLAN
- Evaluate and select custody and brokerage arrangements
- Negotiate all fees
- Handle account setups, investment contracts, and other administrative work
- Perform ongoing reconciliation of all transactions
- Communicate goals and objectives with investment managers
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MONITOR AND REPORT RESULTS
- Conduct continuous due diligence and monitoring of investments
- Recommend manager changes if necessitated by:
- Red flag items
- Departures from objectives or style
- Poor performance
- Asset class or strategy concerns
- Recommend changes in investment strategy, as appropriate
- Conduct strategic reporting:
- Track all trading activity through internal system
- Provide monthly and quarterly reports to clients
- Monthly account reconciliation
- Client meetings and updates as desired