Bankers and brokers usually have all of your assets at risk in their asset allocation pie chart. We don’t.  That makes no sense to us since you are exposed to both stock market risk (the risk of losing money in the stock market) and interest rate risk (the risk of losing money on your bond funds as interest rates go up).

We use two sided investment models that are designed to make money in up or down markets to try to minimize your stock market risk. The stock market is a two sided market. It goes up and down. Why not use models that are two sided models too, that are designed to make money in up or down markets? That makes sense to us, and we are vindicated in our decision because the two sided models have some of the top performance in the last 16 years.

What about interest rate risk?  Bankers and brokers put your “safe money” in bond funds. There are two major problems with that approach. First, you are not making much on those funds since interest rates are so low. Second, you will lose money on those bond funds when interest rates go back up. Bankers and brokers use the Rule of 100 to decide how much of your funds to put into these bond funds. If you are 60 years old then 60% of your portfolio will be in bond funds earning very little and exposed to interest rate risk.  According to the Rule of 100, your age is the percentage of bonds in your portfolio.

That is silly and makes no mathematical sense to us.

We use laddered, principal guaranteed accounts to generate your income for the next 20 years. If the stock markets go up or down, if the economy goes up or down, if the interest rates go up or down….it does not destroy our client’s retirement and send them back to the workforce.

We try to eliminate interest rate risk and minimize stock market risk to your retirement plan.