Portfolio Development And Management

Our first step in designing allocated portfolios for our clients is to manage expectations by accurately assessing the amount of market risk each client is comfortable taking. Every investor has a certain amount of risk that he or she can handle, and it’s critical to identify that level of risk up front. This is a crucial step in bringing our clients on board because typical investment patterns tend to follow:

  • When the markets are up: we feel positive and excited, so we buy.
  • When the markets are down: we feel negative and fearful, so we sell.

This model of behavior, buying high and selling low, is logically the wrong approach to take with investing but it is seen over and over again. Our allocation and portfolio building method is to use a framework that allows human behavior to exist in the context of the amount of risk each individual client is willing to take with their investments.

We don’t try to overcome human nature or to time markets. We help our clients invest within the bounds of how much market risk they can handle, in the context of the identified financial planning goals, and stay invested for the long run. In our opinion, they will not only do better for themselves, but continue a long and satisfied relationship with Hubbard Financial Planners.