Process

Process

Plan

Review

Performance

Portfolio

Security

Assets

We are passionate about what we do, and we are equally disciplined in how we do it.

Our approach to portfolio management follows a disciplined process of fundamental research, due diligence, asset allocation, investment selection, portfolio construction and trading, and ongoing monitoring, reporting, and review. Why is this important to you? A structured, controlled process helps take the emotion out of investing, and ensures that your assets are actively managed and monitored with thoughtful intention in line with your personal objectives and risk tolerance.

Investment Approach

We create and implement globally-diversified portfolio strategies that meet each client’s life goals and financial challenges. We engage in a dialogue with our clients to understand their financial needs, goals, and constraints, and then identify the right investment strategy to meet them.

We define asset allocation targets for a number of investment strategies designed to meet various risk/return objectives— from capital preservation to long-term growth. We construct globally diversified portfolios comprised of individual securities, managers, or both, depending on each client’s specific needs and circumstances.

Our investment team conducts independent due diligence, analysis, selection, and ongoing monitoring of investments (individual securities and managers). We work on an open architecture platform with access to a wide universe of securities and managers. We subscribe to and obtain global data and analysis from a number of sources in order to inform our decision making process.

Our investment approach is from the vantage point of “fiduciary” advisors, which means we make investment decisions based solely on the best interests of our clients. We are paid only by our clients and are conflict-free.

Asset Allocation

We believe that long-term investors will be best served by holding globally diversified portfolios, consistent with one’s investment objectives, risk tolerance, and time horizon. We invest across asset classes, geographies, and economic sectors to improve portfolio diversification and risk-adjusted results.

We establish a strategic asset allocation that seeks to balance expected risk and return over a long-term investment horizon. We analyze historical data (performance, volatility, and correlations between and among asset classes over different time periods and economic environments) as well as the current market environment and relative valuation of assets to determine our strategic asset allocation for each investment strategy.

We believe an asset allocation that provides exposure to and diversification among traditional and alternative asset classes in proportion to the client’s risk/return objectives is important to manage risk and volatility while helping clients achieve their respective capital preservation, income, and growth goals. We focus on being strategic, but will be tactical if opportunities present. We utilize managers with flexible mandates as well.

We believe the greatest detractors to the success of individual investors historically stem from three mistakes: accepting more risk than desired or realized; chasing short-term returns; and poor timing decisions. Through a balanced asset allocation, our goal is to lower volatility, enabling our clients to adhere to a long-term investment approach.

Security & Manager Selection

We employ individual securities, mutual funds, and exchange traded funds in our portfolio construction process. We endeavor to find securities where we will be able to achieve attractive risk adjusted returns.

Security Selection Process
When purchasing equity securities, we target high-quality companies that trade at reasonable valuations, which also have a compelling business model and a talented management team with a track record of making thoughtful capital allocation decisions.

When purchasing fixed income securities, our priority is return of capital over return on capital. We evaluate interest rate and credit risks relative to the anticipated return to ensure that we are being properly compensated for the risk we assume.

Mutual Fund and Manager Selection Process
We use a thoughtful quantitative and qualitative due diligence process in which we seek to identify top managers in each respective asset class. Our quantitative analysis starts with fundamental research of multiple databases, and a comparative analysis of extensive information about the managers, portfolio composition and structure, fund expenses, performance attribution, and risk statistics.

Qualitative analysis includes phone calls, in-office meetings, conferences, and on-site visits to understand the fund’s management, culture, and processes which contributed to the quantitative results in order to inform our expectations about future performance. We seek to understand how the manager selects investments, what information is used, how that information is analyzed, and the processes and controls that define how conclusions are executed and reviewed.

Portfolio Construction & Trading

We use a state of the art trading system to execute trades on behalf of our clients in accordance with their investment policy statement. We construct, review, and rebalance portfolios based on changes in market conditions or client circumstances, our assessment of portfolio holdings, and/or significant contributions or withdrawals. We generally favor low-turnover and tax minimization strategies, but investment rationale takes precedent in our trading decisions.

Performance & Transaction Reporting

The Fiduciary Group custodies client assets primarily with Charles Schwab & Co., the leading custodian of assets for Registered Investment Advisors in the U.S.

We provide customized, consolidated performance, position, and transaction reporting on a quarterly basis. In addition, Schwab provides independent monthly statements and trade confirmations.

We believe reporting transparency is critical to a successful advisory relationship and ensures that clients not only understand how their portfolio is positioned and why, but also how their portfolio is working to achieve their goals. Information is always available via our secure client portal and Schwab.com.

Review Meetings

At The Fiduciary Group, we believe effective communication is critical to a successful advisory relationship.

Our goal is to inform and educate our clients about their portfolio and investment strategy, as well as understand when changing client circumstances may affect the portfolio’s strategic direction.

Our commitment to client communication includes a regular meeting schedule, quarterly portfolio reporting including a quarterly market update, and our quarterly newsletter.