Custom Investment Strategy

Setting clear investment objectives can be a real challenge for most investors. A number of factors determines a portfolio’s success or failure:

• RISK TOLERANCE: People often describe themselves as “conservative” or “moderate,” but what does that mean? In truth, most people have no idea of the risk level inherent in their portfolios at any given time.
• EXPECTATIONS: The bull market of the late 1990s caused investors to feel overly confident and they became too aggressive.
• MARKET EXPOSURE: The subsequent bear market of the early 2000s caused many investors to lighten their exposure to risk and withdraw from the market after it had already gone down. Having too much exposure when markets go down and not enough when markets go up is one of the primary reasons people have poor investment experiences.

At Canterbury, we produce a Custom Investment Strategy (CIS) for each of our clients. The CIS outlines the investment guidelines and procedures to be followed by the portfolio manager. It clarifies the appropriate investment process so the client and portfolio manager know they’re on the same page. It identifies the client’s needs, goals, objectives and risk tolerances, and it establishes reasonable expectations, objectives and guidelines for investing the portfolio’s assets. It defines the responsibilities of the investor and the advisor, and it encourages effective communication between portfolio manager and client.

A well-written investment strategy increases the likelihood that the portfolio will continue to meet the investor’s financial needs. Perhaps most important, our Custom Investment Strategy clarifies the relationship between the clients’ money and their freedom to do what they want.