The IPS is my recommendation on how to best allocate and diversify your assets to meet your long-term goals. My recommendations are based on the outcome of the financial plan, our discussions and risk analysis work we will have completed. The IPS includes:
- My philosophy and approach to managing clients assets
- Analysis of and recommendation concerning existing investments
- Recommended portfolio asset allocation
- Portfolio rebalancing metrics
For some clients, we may reach the target asset allocation plan quickly. For others with low cost-basis stock holdings or concentrated stock positions, tax considerations may have an impact on when we can reach our target asset allocations.
While each client's IPS us customized, five themes are important in the construction of any portfolio:
- Diversification
- Capture the compensated risk dimensions of the markets in the most reliable fashion - Tilt the portfolio allocation to areas that increase expected returns
- Minimize costs
- Minimize taxes and turnover
- Asset allocation vs asset location
- Use tax managed funds in taxable accounts - Maintain asset allocation