Investment Management Process

We believe that fundamental, valuation, and technical factors form the basis of a sound investment decision-making process. Relying heavily on these three factors, we use a diligent process for designing the asset allocation and security selection framework for portfolios.

Asset Allocation: Building One Portfolio at a Time

The investment climate today offers a sea of opportunities and challenges. We focus on understanding when the market environment is rewarding or penalizing which helps to set the framework of the asset allocation to either a defensive or opportunistic tone.

At The Comprehensive Wealth Management Group, we believe that portfolio building starts with a sound, tested asset allocation process. We construct specific portfolios for each of the different themes using an overarching asset allocation process as a guide. All the portfolios must be well-diversified among broad investment types in an effort to provide the most optimal mix to meet varying investment objectives.

Our asset allocation process is a multi-disciplined, collaborative effort. Each week potential investment opportunities are analyzed with the goal of augmenting longer-term perspectives with shorter-term asset allocation opportunities.

Security Selection: Populating the Asset Classes

Once asset allocation has been established, the next step is to populate each portfolio with securities. We operate on a shared philosophy that diligent fundamental research and a well-defined analytical process, rigorously adhered to, is the key to identifying, recommending, and monitoring investment opportunities that offer the potential for superior long-term, risk-adjusted returns.

Portfolio Construction: Putting It All Together

Once the asset allocation is created and the due diligence is done on the individual securities, it is time for portfolio construction. The key finishing step in our process is to strive to ensure that the combination of securities leads to a strong performing portfolio. Simply taking a variety of securities from different asset classes and weighting them in a particular manner does not ensure a strong performing portfolio. Analysis must be done on the portfolio as a whole to make sure the end combination is as strong as we can make it.

From the asset allocation strategy to the selection and combination of underlying investments, each portfolio is specifically designed to address the objectives of your investment theme. Keep in mind that asset allocation does not ensure a profit or protect against a loss. 

Ongoing Monitoring of Portfolios and Underlying Investments

Once the portfolio has been built and implemented, it is continuously tested and monitored to ensure that it remains true to the original goals. Our investment decisions and model portfolios are monitored closely on a daily basis against their benchmarks, peers, and our own internal metrics. This process ensures that the portfolios are positioned correctly for the short-term and long-term with regard to a variety of factors. Knowing how our strategic point of view, tactical asset allocation, and implementation decisions have performed in the past, and more importantly, why they performed the way they did is a critical input to the decision-making process.

Sell Discipline

The sell discipline framework helps take much of the emotion out of the investing process and helps us monitor the risk-return characteristics of our trades on a real-time basis. The sophisticated and in-depth sell discipline is an important part of the risk management and portfolio monitoring process. The sell discipline enables us to determine two critical components:

How long do we wait until we sell an investment that is lagging?

Conversely, how long do we stay with a successful investment idea before taking profits?

The result is that our team can focus on the continued validity of the investment thesis. We monitor such factors as macro variables, valuations, fundamentals, and technicals, among others — to ensure whether the thesis is still valid or if a sell is warranted.

No strategy can assure success or guarantee against loss. All investments are subject to risk and may involve loss of principal.