Video and Blog Follows Below
Steve discusses his role at Atlas, how we are different and our approach to investment management. The format for the video is question and answer:
- What is your role in the firm?
- I am a principle in the firm and the portfolio manager. As PM I head the investment committee and I am responsible for developing our investment models and choosing the investments. I also help supervise our financial planning process.
- Education: The level of education at Atlas is much higher than most firms in this profession and we believe there are few firms that have our level of education. We have staff with multiples masters degrees, Laura has PhD in financial planning Gary is a CPA and everyone in the firm has to have a CFP designation as a minimum.
- Experience: Laura and I have over 60 years of combined experience, our head of financial planning has 11.
- Compensation: we are completely fee only and as members of NAPFA we are not allowed to accept payment from any third party. This form of compensation has fewer conflicts that others.
- Client interest must come first. We must act in the best interest of our clients and always put their interests above ours.
- My original education was in engineering, I did do postgraduate work in both engineering and physics.
- I have a master’s in finance and Investments, another in financial planning and I am a CFA, CLU, ChFC and CFP. From the standpoint of portfolio management being a CFA Charter Holder is an important level of education to have. Most designations in this profession are rather lite on the education needed to manage portfolios. In fact, even among NAPFA members an association (one I am very familiar with since I am a past National Chair) with some of the most highly educated individuals in the profession only 8-9% are CFA Charter Holders.
- We believe that markets are relatively efficient therefore Asset allocation is a primary driver for client return. Diversification across many asset classes is important, we have carefully chosen those asset classes based on detailed research and their characteristics, I would liken it to choosing pieces of a puzzle where the sum of the parts is greater than each individual part.
- We do not believe in timing markets.
- We manage client portfolios that are conscious of costs and tax consequences.
- What differentiates us from other firms is the highly disciplined method we use to create portfolios. Unlike the subjective and inconsistent approaches, you commonly find at other firms, our approach is both objective and research driven.
- We used an advanced form of Modern Portfolio theory we like to call “enhanced MPT.” Here is a link with an overview of some of the enhancements: Ehanced MPT.
- We believe that few active managers can consistently beat the market therefore controlling costs is extremely important.
- We spend a significant amount of time understanding your tolerance for risk and your capacity for risk. Those are two very different things; one considers how you respond to market declines emotionally the second relates to how much risk you can afford to take based on your circumstance. While risk tolerance questionnaires do help establish the first getting to know you as a client is ultimately much more helpful. It is important to establish how much risk you can afford to take. That is why the financial planning process is critical to deciding how much risk you can afford to take. Many investment only firms will not go through that process they may only assess your risk tolerance they are not going to go through the formal, detailed process we use to establish your goals and your need for income and how it relates to the investment strategy we are recommending.
- We like to review in detail with you how the allocation we may recommend to you will respond to different market conditions. Our goal is to make sure your portfolio matches your feelings about risk, your goals and need for income and that you understand your how investments may grow; or decline if there is a market correction.
Here is the link for the video: