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PROCESS – Trust, confidence, knowledge, and experience are just a few of the reasons given when our clients are asked what they appreciate most when engaging Evans Financial Partners. Trust is typically the key factor in an individual's portfolio decision making, next is perceived value and risk aversion follows closely. We feel clients are looking for an advisor they feel comfortable with; someone whom they feel delivers high quality services and solutions, as well as a broad range of investment options that have been selected objectively from the enormous universe of investment alternatives that are available. We follow a detailed Investment Consulting Process with our clients designed to build trust and confidence with our clients each step of the way.
We create individual solutions for our clients. We do this by applying a four-step investment consulting process . The investment process affords you access to the knowledge, resoruces and experience of professional investment managers while receiving ongoing guidance from your financial advisor. This four-step process identifies your goals, constructs an appropriate strategy, implements the investment plan and monitors it for assured effectiveness through market cycles. It is simple, but if we stick to it, our clients are typically successful. Our clients depend on us to stay true to the process, and that is what we do. The investment process will illustrate exactly what we do.
Step 1: Identify the Clients Needs and Objectives – Understanding the client's level of risk tolerance is a vital component in the investment process. The picture we develop serves as the foundation for a long-term investment strategy that is designed to suit your needs and preferences rather than following some prescribed and standard patterns. The answers to the fundamental risk tolerance questions provide the main building blocks for managing your assets, setting our Investment Consulting Process in motion.
Step 2: Building the Asset Allocation Road Map – One of the most critical components of the Investment Consulting Process is building the road map which sets the route, or the strategy for the client's asset allocation plan. The rigorous framework within which our investment consulting process operates allows us to determine an asset allocation strategy that forms the degree of weightings that should be given to the various investment vehicles in your portfolio. The weighting of the various asset categories that make up a portfolio is one of the most important factors in the successful implementation of any investment strategy. A landmark study by Brinson, Singer, and Beebower (published in 1991) indicates that asset allocation is the primary determinant of variations in a portfolio's performance, while only a small percentage can be attributed to security selection or market timing. We also avoid over-diversification*, as spreading too thin dilutes the value of diversification. Furthermore, diversification should not focus solely on holdings or managers that promise above-average potential gains; the stability of returns and the balanced nature of the portfolio are equally vital to us. We want to grow your wealth, but more importantly, we want to do everything in our power to protect your family wealth.
*Using diversification as part of your investment strategy neither assures nor guarantees better performance and cannot protect against loss of principal due to changing market conditions.
Step 3: Recommend Asset managers and Implement the Plan – Part of the Investment Management Consulting Process is to find great money managers. Many of these managers have institutional account minimums of over $1,000,000. By working through us, however, we can offer this management at much lower account minimums. We work with a partner who provides us with access to many top-tier, leading asset management firms in the country across a broad variety of disciplines. Since each investor has unique circumstances that must be met, we have a deep set of managers to choose from. This means, for example, we can fine tune the asset allocation for each client, allowing for risk tolerance, income needed and time horizon.
Our partners have a team of research analysts who serve a very important purpose: with a universe of thousands of investment managers offering thousands of different portfolio strategies, careful evaluation and due diligence is crucial to sifting the wheat from the chaff. Manager selection is a vital component of the Investment Consulting Process that we offer our clients. We believe that smart selection and blending of these managers can help deliver consistent and sustainable performance, which enhances your prospects of not only building, but also protecting your wealth. To help you achieve your objectives, we identify, hire and monitor a select group of asset managers who are specialists in their respective disciplines. We look for managers who balance each other, who do not overlap to create too much concentration in one area, who are very good in their market niche and who have demonstrated a consistency that we are comfortable with. By combining these managers, we are crafting suitable solutions to meet the goals of our clients.
Step 4: Ongoing Portfolio and Manager Monitoring – Continuous portfolio and asset manager monitoring is the final step in the Investment Consulting Management Process and provides the basis for our ongoing relationship with our clients. Some benefits of ongoing portfolio and manager monitoring include:
- Ensuring the client's portfolio continues to adhere to the strategic asset allocation plan determined earlier in the process, rebalancing as necessary
- Conducting rigorous analysis and due diligence of asset managers to ensure consistency and relevance and to provide assurance to our client that the portfolio is on track to meeting their goals.
- Providing our clients with access to daily reporting.
We find our clients enjoy this process and see it as a change from the intimidating and confusing experience. We feel that our process helps to educate our clients, and give them the confidence to make an informed, fact-based choice.
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