Pinnacle manages globally diversified investment portfolios tailored to each client’s individual financial goals as well as to their degree of comfort with fluctuations in the investment markets in both a tax efficient and cost efficient manner.
Investments are held in insured accounts in each individual client’s name at a discount brokerage firm such as Charles Schwab & Co. and / or TD Ameritrade. These custodians provide on-line access as well as monthly reporting. Pinnacle provides quarterly reports, including reports on the performance of the account.
The minimum account size of a Discretionary Investment Management client is $500,000 of assets under management. For purposes of determinging whether a client meets this minimum, Pinnacle considers the combined total of accounts for all family members at the same residence.
Our fees are based solely upon the value of the account and we do not accept payment or commissions from any mutual fund or investment manager.
Investment options available to us include: individual securities, actively managed no-load mutual funds, exchange traded funds (ETF’s), passive “asset class” funds, separately managed accounts, CD’s, and no-load variable annuities. We can utilize a combination of these investments, and select an approach for each client which we feel offers the best possibility of achieving their investment objectives
Our Core Investment Beliefs
Investing is both art and science, however there are a few aspects of investing that are widely accepted:
Each investor is unique, and each has different financial goals and risk tolerance. It is important that our clients’ portfolio be one which will help them achieve their financial goals while not subjecting them to an uncomfortable level of risk.
Diversification is important, and in today’s world, that means diversification globally and across many asset classes. Diversification reduces the likelihood that an investment portfolio will have a significant loss if anything goes awry with one company, market sector or asset class.
Investment managers who invest their own money the same way that they invest their clients’ funds have much greater credibility. This is a principle we follow and we prefer to invest with managers who share and follow this principle.
High bond yields, high stock dividends, and dazzling stock returns do not come without increased risk.
The stock market goes through cycles. It is human nature to extrapolate both rising markets and falling markets and imagine the trend will continue indefinitely. This causes many investors to buy high and sell low, resulting in low returns. The best results are achieved by following Warren Buffet’s advice to buy when others are fearful and sell when others are greedy, which requires both patience and the courage not to follow the crowd.
Undervalued stocks have historically out-performed growth stocks over longer periods of time
Stocks of small companies have historically out-performed stocks of large companies over longer periods of time, but with greater volatility
Unless a mutual fund or separate account manager has a very extensive track record, it is statistically difficult to identify in advance who will out perform the market over time. We believe (but can offer no guarantees) that we can improve the potential of identifying top managers by learning as much as possible about the manager, their team and investment process and by ruling out managers with poor records and those who charge very high fees.
Even good investment managers who do out-perform the market over a long time, have periods of under-performance.
Periodic rebalancing of portfolios by selling investments after they have gone up and buying other investments which may have gone down can improve returns of investment portfolios.
Costs are an important consideration. Of course the objective is not necessarily to minimize costs, but rather to maximize risk adjusted return after all expenses.
Taxes are an important factor in investing and can have a significant impact on overall returns. Deferring taxes will help increase returns as long as pre-tax returns are not sacrificed to do so. A prudent goal is not necessarily to minimize taxes, but rather to provide good risk adjusted after- tax returns. Sometimes this may mean taking gains and paying taxes in order to earn a higher return in an alternative investment.
There are many investment options available to investors today. Open and closed-end mutual funds, exchange traded funds (ETF’s) individual securities, and separately managed accounts. None are perfect for every situation. Each offers its own advantages and disadvantages. We have the ability to choose the best approach for each investor’s situation and can mix and match any of these options.