Contributed by: Center Investment Department
Investment risk is real. Every day. Every year. In up and down markets. Even in good times – when, for example, U.S. Equities are performing well – we all can use this friendly reminder:
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. In one of his many timeless quotes, he states, “The essence of investment management is the management of risks, not the management of returns.” To many investors, this statement may seem counterintuitive. Rather than an alarm, though, risk may serve as a healthy dose of reality in all investment environments.
Our Take on Risk
How do we at The Center attempt to manage risk as we steward approximately $1.1 billion in assets? We:
Stick to our defined investment process
Create and monitor individual investment policy statements
Determine proper strategic asset allocation and make necessary tactical shifts
Execute extensive research for every security that makes it into your portfolio
Implement strict rebalancing guidelines
We have been managing client assets for more than 34 years. We fully understand and appreciate the importance of investment returns. We also know that risk is an important element when 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 who follow our risk management tactics may better stay on track with their financial plans.
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.
Any opinions are those of Center for Financial Planning, Inc.® and not necessarily those of Raymond James. This material is being provided for information purposes only and is not a complete description, nor is it a recommendation. Investing involves risk and you may incur a profit or a loss regardless of strategy selected. Prior to making an investment decision, please consult with your financial advisor about your individual situation.