Asset Management Services

Many financial planners decide how they will handle asset management before ever asking about client goals. This approach benefits the advisor, not the client.

At Quinn Financial Planning (QFP), our approach to providing the highest quality asset management services is rooted first and foremost in understanding your needs, your requirements, and your tolerance for investment risk before we recommend any investment solution. We listen, gather data, and make informed decisions about any investment that is suitable to your needs.

How We Approach Asset Management

Just like other financial planning services, asset management requires a personal touch. At other financial institutions, financial planning is a system of quickly getting you in the door, filling out a risk tolerance questionnaire, and assigning you to a predetermined allocation of mutual funds stocks, bonds, or exchange traded funds (ETFs) that has already been decided by a computer algorithm or some investment gurus in another office, city, or even another country. Granted, no one person or firm can be an expert in every listed stock, bond, ETF, or mutual fund. But with Quinn Finanical Plannings’s use of technology, academic background, and training, we calculate various statistical measurements that help us in the design of your investment portfolio.

QFP’s asset management is based on understanding your level of risk to make an informed decision regarding which assets to include in your portfolio. Not all clients have the same financial goals or risk aversion. An understanding of risk and the relationship between risk and return is necessary for any prudent long-term investor.

Successful investing means managing risks that may needlessly compromise performance. Avoidable risks include holding too few securities, overreacting to market predictions such as interest rate movements, or relying solely on information from third-party analysts or rating services.

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What is Asset Management?

There are two general types of investments that make up an investment portfolio. The first is stocks or equities, which represent an ownership in a company. If the company performs well, the stock price should rise. The second is bonds, which represent a loan that investors make to a company, state, or U.S. or international government. Bonds are contractual obligations where interest payments are paid by the borrower, and the face value of the investment is returned at a maturity date. Bonds are generally considered to be lower risk/lower expected return types of investments.

These stocks and bonds are purchased individually directly through an investor’s account or through the company or issuer. Recently, stocks and bonds have become available to be packaged or grouped together within investment products. These products are known as mutual funds, exchange traded funds (ETFs), or unit investment trusts (UITs). The benefits of these products are many. It is easier for small investors to purchase a basket of stocks and bonds from multiple companies. ETFs give investors intraday pricing and more discretion over the timing of their trades. In any event, use of mutual funds or ETFs allows small investors similar access to large investors. Before mutual funds and ETFs, if an investor wanted to diversity by investing in, say, 10 companies in the utility sector, the investory would have to buy stock in all 10 companies individually. Now, the investor can diversify by choosing a fund that includes these companies in its portfolio, and buy shares of that fund with just one transaction.

Stocks

Stock or equities represent ownership in a company. If the company performs well, the stock price should rise.

Bonds

Bonds represent a loan that investors make to a company, state, or U.S. or international government. Bonds are generally considered to be lower risk/lower expected return investments.

QFP As Your Asset Manager

After we have an understanding of your investment goals and the level of risk you are comfortable with, we will assemble an investment list that may contain actively managed or index/passively managed mutual funds or ETFs or individual company stocks. Our selection process takes into account fundamental attributes that give us the lowest risk/highest reward characteristics among investment choices, paying very close attention to the total cost of investment expenses, and the effect of taxes on returns. Again, using our academic background and professional training to our highest limits gives our investors the best chance of having a highly successful investment outcome.

QFP explains the investment selection to all its clients. Once an investment agreement is in place, our firm drafts an Investment Policy Statement (IPS) that begins by outlining the investor’s objective, as well as any significant constraints. Defining these elements is essential because the plan needs to fit the investor; copying other strategies can prove unwise. For example, investor A may be young and just entering the workforce, and thus want a more aggressive strategy. Investor B may be retired and on a fixed income, in which case a more conservative approach is in order. Because most objectives are long-term, the plan should be designed to endure through changing market environments, and should be flexible enough to adjust for unexpected events along the way. Once the IPS is in place, the investor and QFP will evaluate it at regular intervals.

A Note from Timothy Quinn on Asset Management

Founder of Quinn Financial Planning

I believe careful asset management requires a solid plan and discipline. Investing can provoke strong emotions in the face of stock market turmoil. Without a sound financial strategy such as one offered by QFP, investors may find themselves making impulsive decisions, or become unable to implement an investment strategy.

Our firm provides the explanation, adjustments, and discipline for you to maintain perspective and adherence to our Investment Policy Statement (IPS). Our firm will never spontaneously depart from a client’s carefully selected IPS, nor will we blindly chase last year’s mutual fund performance winner. Without this discipline and plan, investors often build their portfolios as one would build a baseball card collection—they are drawn to evaluate a particular fund or stock because of some historical statistic, often without thinking about how or where it may fit within the overall allocation.

A recent study published by Vanguard showed that using an asset manager can potentially add about 3 percentage points to your portfolio returns over time. The study attributes three reasons for success to:

Portfolio construction—Use of low-cost investments and location between taxable and tax-favored accounts.
Wealth Management—Using regular rebalancing and spending strategies for cash needs.
Behavioral Coaching—Advisor guidance and discipline to adhere to the investment plan.

The biggest value QFP provides is the discipline to adhere to your IPS.

As you can see, asset management consists of coordination of equally valuable talents, all of which play an integral part of your investment experience. From listening and understanding your level of risk, to the investment selection process, all the way through the maintenance and applying adjustments and discipline through the Investment Policy Statement, Quinn Financial Planning is the right choice for all your asset management needs.

“The biggest value QFP provides in regard to Asset Management is the discipline to adhere to your Investment Policy Statement.”
– Timothy Quinn, CFP®