Auric Capital Partners

Asset Allocation

Asset allocation is our first area of focus, since it is the dominant factor in determining total portfolio return and safety. Studies have shown that asset allocation decisions account for a much greater proportion of total return than either security selection or market timing. Therefore, the overwhelming determining factor for the success of an investment strategy is how the portfolio is divided among the various asset classes, such as bonds, equities, cash, commodities, real estate, alternatives, etc.

Portfolio Structure

We identify managers who invest in distinct sectors or styles of the markets as well as low-cost passive strategies. By combining the two approaches, we get a lower overall cost and maintain the potential to outperform over market cycles. The specialists we select adhere to a predefined investment discipline, (such as large company growth managers), have an opportunity to hone their approaches and anticipate changes within their areas of the market. The use of specialist managers combined with low-cost index ETFs and specific securities chosen by our own investment team is also consistent with our view on spreading investment risk across various asset classes and styles within those classes. We select highly ranked managers for the various sectors and styles in order to diversify portfolios and take advantage of economic trends. This coverage is continually monitored and adjusted when appropriate to reflect strong relative performance, current conditions, and outlook.

Continuous Portfolio Management

Portfolio management is a continuous process. Once each client’s needs are defined, a plan is developed, a strategy is implemented. Confirmation and re-evaluation of the portfolio progresses as our clients’ needs and circumstances evolve. From the portfolio perspective, there are two critical components of our process. First, the portfolio is rebalanced regularly to assure that the mix of assets defined to achieve client goals is constant. Rebalancing reduces risk and keeps the investment plan on the right course. Second, each manager is continually monitored and is subject to replacement should they deviate from their stated philosophy, fail to achieve targeted goals, or lag consistently in relative performance in their peer group.

Tax Management

Taxes matter, and for investors with taxable assets, failing to analyze tax implications can significantly impede the realization of their financial objectives. Research and experience have led us to take a total portfolio approach using multiple asset classes in various types of accounts that have differing tax treatment. As part of our rebalancing process we also comb the portfolios for tax-loss selling opportunities. We believe that focusing on tax management is an important aspect of ongoing portfolio management.

Expectations

Our investment process is designed to provide value along our clients’ financial journeys. We recognize that the only way to truly judge the success of an investment portfolio is by its effectiveness in achieving the goals of the client. We combine our continuous portfolio management with regular client communication in order to keep the structure of the investments aligned with client goals and expectations.

These components of our investment philosophy are the result of decades of experience and research in serving our clients. Our investment philosophy is, in fact, the day-to-day disciplined routine for how we serve every client.