Singer Wealth Advisors Vision Quest Process
Most stock-based investments like Exchange Traded Funds (ETF's), Mutual Funds, and separately managed accounts of individual stocks use what's known as a long-term "buy and hold" strategy. Although many retail investors lack the discipline to hold especially during times of increased volatility. These strategies will occasionally buy and sell underlying stocks in an attempt to overweight stocks that that are believed to be undervalued and underweight stocks believed to be overvalued, in an attempt to create excess return or "Alpha". However, these strategies generally remain fully invested at all times. The attempt to buy the "best" stocks are often futile, as numerous studies show that most mutual funds do not beat their benchmarks in any given time period and especially over long periods of time. In any case, the traditional investment approach anticipates being invested when the markets are both plummeting and increasing sharply in value. Disciplined and patient investors will generally be rewarded with returns that track the long-term returns of equities.
Unlike the traditional buy and hold approach, tactical managers attempt to buy and sell to capture short-term to mid-term price movements and sometimes they make trades that can potentially make money during down markets. Instead of making decisions based on the long-term fundamentals of a basket of publicly traded stocks or based on an overall index, the tactical managers utilize technical analysis to track and predict the short-term movement of major stock indexes. This type of investment management may be invested long or short or remain safely in cash until such time as the analysis identifies a "high probability" trade. Trades may last as little as one day or last several weeks.
When such an opportunity is identified, our tactical accounts will typically invest in leveraged ETF's that track the movement of an index by 2x to 3x. Additionally, the strategy can and will invest in ETF's designed to appreciate when the markets are going up as well as inverse ETF's that potentially appreciate when markets are going down. Most tactical managers utilize risk mitigation strategies to help minimize the impact of losing trades. Both buy and hold strategies and tactical strategies have risk. Most long-term investment strategies assume the risk of a protracted economic downturn whereas a tactically managed account assumes the risk that the manager's analysis may be inaccurate. However, a tactically managed account which is based on technical analysis is not necessarily correlated to the performance of overall economy or the fundamental health of the stock market, therefore having an allocation to a tactically managed long/short account can provide even further diversification to one's overall investment strategy. Please contact us to learn about the performance of our tactically managed accounts.
Modified Endownment Contracts
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