Managing the Portfolio

Portfolio Strategy

I divide a portfolio into 3 main segments. The allocation between segments will be optimized for the client's situation and needs.

My goal as a planner is to outperform the S&P 500 Index while generating income to reduce overall portfolio volatility.

To achieve this goal I will:

  • Assess the Macro-Economic situation of countries.

      • Deflation vs Inflation

      • Currency Strength

      • Government spending and debt

      • Taxes

      • Overall business climate

      • Political Stability

  • Select favorable countries to invest in.

    • US

    • Established Foreign Countries

    • Emerging Market Countries in Asia and South America

  • Identify Industries and companies with stable growing earnings

Additionally it is important to manage risk.

  • Diversification across countries can reduce volatility.

  • Diversification across companies and industries provides safety from unforeseen events.

    • Example: Earnings collapse at AIG in 2008.

    • Example: Financial scandal at Enron in 2004.

  • Dividend Income offers safety during market corrections.