Tools of the Trade

Just as Luke Skywalker had his light saber and Emeril Lagasse his garlic (BAM!), the Investment Management business has…FI 360®?? 

Most investors have heard of Morningstar, which is a financial data provider that provides data on literally millions of different investments.  This is very widely used by the investment community for up-to-date data and financial analysis on a wide variety of investment instruments.  To a lesser degree, you may have even heard of Ibbotson Associates, recently acquired by Morningstar, which has data on portfolio construction and implementation.  

Most, however, even within our wealth management profession, have not heard of another tool we use called FI360®.  This company offers a full circle approach to investment fiduciary education and support. 

This software helps us with our fiduciary responsibility to monitor our investment managers on a regular basis and gives us a red flag if there is something to be concerned about. These are some of the factors FI360® reviews:

  • Manager Tenure – alerts us to recent leadership change
  • Composition of the portfolio – alerts us if the investment is taking a larger amount of risk in some aspect of the portfolio by greatly over- or underweighting something compared to other like investments
  • Expenses – alerts us to increased or higher than average expenses
  • 1, 3 and 5 year returns – alerts us if an investment is underperforming like investments over those periods of time. 

When looking at this information on a regular basis we can understand where we need to dig deeper to make sure the investment is in the best interest of our clients’ portfolios. It’s important to look often but not too often. Keeping an eye on short-term trends can obscure more meaningful long term data. For us, that means a semi-annual review of our recommended investments using FI360® analytics. 

Keeping on top of investments requires tools of the trade. We feel fortunate to have fi360 to get the job done and hope you find the proper tools to help you achieve investment success.  May the force be with you!