Our advisory process encompasses the following steps:
Listen to the Client and Understand their Goals
We will work closely with the Client to understand, among other things, the following:
a. Goals and Objectives
b. Short term and long term income needs
c. Balance sheet and tax status
d. The current investment portfolio structure and managers, current outstanding debt
Design the Portfolio
REI creates a portfolio that seeks the right balance of risk and return on an after-tax and after-fee basis. The design is then formalized in an investment policy statement. At some point during this stage, we may use third-party software to obtain and chart various statistics for differing time periods, asset allocation structures, and potential capital market environments. Designing the portfolio is a multi-faceted task, which can include (among other elements) an understanding and articulation of the following:
a. Asset allocation (at multiple levels);
b. Asset location (e.g., selecting the appropriate accounts for specific investments); and,
c. Client-imposed constraints (e.g., avoiding certain stocks or sectors), including unmanaged assets.
Execute the Investment Policy Statement
REI primarily recommends managed investment products, such as mutual funds, exchange traded funds (ETFs), separate account managers, hedge funds, funds-of-funds, and private equity partnerships. Employing a truly "open architecture" approach, REI endeavors to select the investment strategies in each asset class to achieve the Client's strategic portfolio. It is important to note that REI not only seeks to identify best-of-breed managers, but to combine them in a thoughtful manner that creates an optimal portfolio. At the outset of a new advisory relationship, this step represents the transition from the Client's current holdings and managers toward the recommended portfolio. Rather than forcing a transition for the sake of expediency, REI takes a reasoned approach that considers taxes, trading costs, and market timing risks.
Review, Monitor and Report on the Portfolio
REI monitors Client accounts on an ongoing basis and provides regular and comprehensive investment composition and performance reports. When appropriate, REI will recommend subsequent modifications to the portfolio (e.g., manager changes, tactical asset allocation tilts).