The world of wealth management and financial planning is driven by data. Whether you are watching the ups and downs of a specific investment or the periodic trends of your aggregate portfolio performance, financial numbers and statistics provide telling insights into how your wealth is working for you.
At Welch Hornsby, we put great value in our ability to analyze the plethora of financial data available to us and to create multi-faceted reports that give our clients a clear picture of asset performance, and, in a greater sense, a look at the health of their investment portfolio.
When compiling these reports, we hold true to a pair of values that ensure we are providing the greatest possible value to the client and advancing their knowledge of their investment portfolio: an understanding of performance and a clarity in the numbers.
When analyzing a client’s investment portfolio from a performance perspective, we approach each report with the client’s objectives in mind. We intend to stay focused on and aware of the desired outcome or goals of the investment portfolio. One of our key principles is to “maximize the probability of success, not the magnitude of outperformance.”
Additionally, it is imperative to conduct a continued analysis of each investment on a periodic basis – the majority of the time this is done on a quarterly basis. Creating a timeline, or trend, of investment performance can aid in decision making by determining which investments or assets have consistently generated positive returns.
Subsequently, this helps our team determine if the investment managers are staying true to their process and investment strategy. When compiling reports, we focus on the consistency of returns and determine how outliers of performance affect the long-term performance characteristics of the investment. It is important to keep things in perspective for the client, especially when the volatility of the market begins to impact performance.
Clarity in the Numbers
We believe that reporting should be comprehensive but also easily comprehended. We strive to transform complex information into clear and concise takeaways for clients at all ends of financial interest and literacy. Each report is designed to answer both the overall performance of a client’s portfolio during a specific time period, and where they stand in terms of reaching their goals. We also seek to tell a story and incorporate the broader picture into each report. Whether our clients are reviewing the report alongside a client advisor or picking it up months later, it is imperative that the messages are clear and easily digestible.
While the goals and targets of the portfolio are important, benchmarks help us determine if the investments in the client’s portfolio are meeting our expectations. Therefore, we give thoughtful consideration to each benchmark that is shown and reported to ensure they are appropriate for the individual investments and the overall portfolio. We often will interact with the portfolio management team of the underlying investments to make sure selected benchmarks are aligned with their investment philosophy and process.
A quality report combines an acute understanding of performance that is relative to a client’s main goal and clearly shows performance through numerical data. If you have questions about how we work with our clients to advance their knowledge in financial planning through reporting, contact us today.
The information and data contained herein has been obtained from sources believed to be reliable, but is in no way guaranteed by Welch Hornsby as to its accuracy. Opinions and projections are as of the date of their first inclusion herein and are subject to change without notice to the reader. As with any analysis of economic and market data, it is important to remember that past performance is no guarantee of future results.
Written by Beau K. Williams, CFA