The management of investment risk is constant in successful investing.
Benjamin Graham, known as the “father of value investing”, dedicated much of his book, The Intelligent Investor, to risk. One of his many timeless quotes states, “The essence of investment management is the management of risks, not the management of returns.” This statement can be counterintuitive to many investors. Risk does not have to be an alarm; rather a healthy dose of reality in all investment environments.
Our Take on Risk
How do we at The Center attempt to manage risk as stewards of approximately $850 million dollars?
- Executing a defined investment process
- Individual investment policy statements
- Asset Allocation – both Strategic and Tactical
- Rebalancing guidelines
We have been managing client assets for over 28 years. We fully understand and appreciate that investment returns are important. We also know that risk is an important element in constructing portfolios intended to fund some of life’s most important goals such as sending a child or grandchild to college, funding a long and successful retirement, having sufficient funds for long-term health needs, and passing a legacy to loved ones. While no one can guarantee future investment returns, our experience suggests that those following our risk management tactics above may better stay on track with their financial plan.
If you are a client, we welcome the opportunity to talk more about how your portfolio is constructed. Not a client? We’d enjoy the opportunity to share our experience and review your goals and risk.
Timothy Wyman, CFP®, JD is the Managing Partner and Financial Planner at Center for Financial Planning, Inc. and is a frequent contributor to national media including appearances on Good Morning America Weekend Edition and WDIV Channel 4 News and published articles including Forbes and The Wall Street Journal. A leader in his profession, Tim served on the National Board of Directors for the 28,000 member Financial Planning Association™ (FPA®), trained and mentored hundreds of CFP® practitioners and is a frequent speaker to organizations and businesses on various financial planning topics.
Investing involves risk and investors may incur a profit or a loss. Any opinions are those of Center for Financial Planning, Inc. and not necessarily those of Raymond James. C14-004278