It Is The Destination, Not The Journey

5 Years ago I made a change. I wanted to build a wealth management company that created a client experience that was a different and better alternative to the standard and antiquated bank and financial services industry.

I purchased a half interest in a Portfolio Management  company called High Rock Capital Management with the goal of creating a Private Client Division that would do just that. My business partner, the original founder of High Rock, Paul Tepsich and I had a very similar philosophy: We would invest our money in a way that we were comfortable with, that would see us to our end goals. Then we would invite those who wished to join us on our journey to come on board. A group of my clients chose to take this same path with us and as we approach our 5th year anniversary, we are thrilled to have grown our private client business by about four times its original size. We still have some room for those who have the desire for something different and better.

Our philosophy is simple: each client and client family have very specific and distinct goals, therefore their investment portfolios should reflect this. While our mandate is to invest for our clients in the exact same assets as we would own for ourselves, the percent weightings may differ to reflect the individual nature of each client strategy. This strategy is determined after an in-depth analysis of their financial circumstances and their long-term goals and is presented in a Wealth Forecast prepared by our Certified Financial Planning professional (Bianca Tomenson).

Most importantly we (at High Rock) have signed off on and adhere to the highest levels of integrity available to the investing public with our Voluntary Code Of Conduct For The 

Stewardship Of Your Wealth.

Friends, this is not exciting stuff. As I suggest on my Twitter profile (https://twitter.com/JSTomenson) : "Wealth and portfolio management is not about shooting the lights out. It is about slow, methodical planning to reach long-term goals". So if you want instant gratification and excitement, as the advisor and media cheerleaders offer, we are likely not for you. Paul, Bianca and I do not like to take risk outside of the parameters for achieving our goals and unless our clients express the desire for taking greater amounts of risk, specifically, our tendency will be to manage the risk first and let performance be determined as a function of the risk that we take. 

When stock markets are strong, as they were in 2016, 2017, 2019, we will under-perform them (because we run balanced portfolios). When they are weak, as they were in 2015 and 2018 we will out-perform, thereby protecting our clients from volatility and the more difficult to catch-up periods following significant down-side moves to asset prices. However, as per the chart above, we will out-perform over longer periods of time on a return per unit of risk taken basis (red circle). Oh and by the way, despite all the hoopla about stock markets in calendar year 2019, markets are up considerably less from September of 2018, just a few months earlier (but whatever, just a very small part of the much longer journey):

If you want to focus on the stewardship of your wealth which will take you to your destination, give it some thought. Personally, I would rather the journey be comfortable (you can sleep at night) rather than exciting, with a greater chance (less risk) that I will get myself to where I want to go.