Do more of that which is working

“Do more of that which is working and less of that which is not”!

That is one of Dennis Gartman’s 20 rules of trading. Dennis Gartman, if you do not already know, is a widely read and admired market commentator who writes a daily letter to which I subscribe and it is the first reading on my agenda every morning. Ever insightful and informational on a variety of topics: markets, currencies, commodities, economics and politics.
Every year on the Friday after US Thanksgiving he publishes his 20 rules of trading.

“Do more of that which is working and less of that which is not”!

So what is working?

1) Clients both old and new are slowly coming around to the idea of seeing their “Wealth Forecast”.

a. Generally speaking, this is a spreadsheet that we create that shows clients their income streams now and those that are forecasted for their future vs. their desired or expected lifestyle needs (cost of living) and then analyzes what the approximate impact will be on their assets.

b. We make a number of adjustable assumptions on things like return (after fees and taxes), inflation, tax rates and we create a “working model” from which we can project 10, 20, 30 or more years into the future.

c. We have the ability to create a number of different models that represent scenarios from which we can select the most advantageous options.

d. From this we have a full understanding of the clients risk profile.

e. We make the appropriate asset allocation strategy and implement it.

f. What we have is our “benchmark” from which we can gage the client’s progress.

g. If (as we fully expect there will be) there are any changes that need to be addressed we can quickly re-asses strategy by making adjustments and visualizing their impact on our model, followed-up with an adjustment of strategy.

2) While we believe that over the longer term, 5 to 10 years, equity markets will resume their upward trajectory, we also know that:

a. Clients have cash needs (from their assets)

b. Depending on specific needs, we believe that a diversified, balanced portfolio will allow easier access to client assets for these purposes.

c. Where are we finding balance and low volatility (i.e.while equity markets are down, what is up) ?

i. One Capital Management, managed portfolios
ii. Waterfront Nxt Income and Growth
iii. Norrep Yield Fund

Visit our website at www.jstomenson.ca

Envision your future