An investment portfolio built specifically for you
At Trifecta Capital Advisors, one of the primary services for which we are known is providing tailored portfolio creation and ongoing money management that supports the client’s overall financial well-being in the long run. Here are the elements that comprise our investment philosophy. When you become a client, we will discuss these elements thoroughly with you and determine the best course forward.
Element #1: Planning/Asset Allocation First we determine the appropriate asset allocation for you based on financial and non-financial goals, family, cash flow, liquidity, expenses, risk tolerance, and time horizon. We weigh these factors to arrive at an allocation that appropriately rewards you for the amount of risk that you are comfortable taking.
Each client has a documented Investment Policy Statement with target allocations related to stocks, bonds, and cash. Ranges (above and below target) will be built-in around all asset classes in order to:
Allow for market fluctuation
Provide the ability for tactical adjustments based on market and economic conditions
Element #2: Macro Asset Allocation Trifecta uses proprietary capital market assumptions for the potential risk and return of each major asset class (stocks/bonds/cash) as well as correlation data to provide a diversified investment portfolio across different sub asset classes. This discipline is the basis for our long-term strategic recommendations.
Based on current global conditions and expectations for the near term, we look at valuations, technical analysis, and economic data such as interest rates, inflation, employment data, and other relevant factors to make tactical adjustments to our long-term recommendations.
Within stock and bond asset classes, we then allocate funds to sub asset classes based on similar criteria related to valuation (absolute and relative), trends, and micro data. We will focus the major asset classes on domestic large capitalization stocks and domestic investment grade bonds. In addition, for diversification purposes, we may use other attractive asset classes such as domestic small- or medium-size companies, international companies, commodities, or REITs (real estate investment trusts).
Similar diversification will be used within bonds by potentially incorporating high yield bonds or preferred stocks.
Element #3: Individual Securities/Security Selection For long-term capital appreciation, we will in invest in companies that are high-quality corporations with management teams that concentrate on creating shareholder value. Our focus is typically long-term growth and attractive valuation. We will perform ongoing fundamental, bottom-up research using internal and external sources.
Companies in which we invest will most likely have the following characteristics:
Compete in areas with large future market opportunities with positive secular trends
Have a competitive advantage or are in an industry with significant barriers to entry
Show strong cash flows and balance sheets
Bonds will be chosen based on your specific tax situation coupled with the bond’s maturity and quality. Each individual purchaser’s tax situation will be analyzed to determine if tax-exempt or taxable bonds are appropriate. Maturity decision will focus on current and future yield curve analysis, domestic growth forecasts, and inflation expectations. To mitigate risk, we will be diversified across different states and/or corporations. Mutual funds or exchange traded funds (ETFs) will be used where appropriate. We use proprietary analytical research and tools to determine best-in-class solutions. We may use active or passive mutual funds depending on the situation or asset class. Where consistent alpha is demonstrated, active funds will be used.