AFS’ focuses on portfolio construction and on-going investment management. Portfolios are constructed using Modern Portfolio Theory and Efficient Frontier software. Periodically we overlay each client’s portfolio with cash flow analysis to benchmark where they are on the path to a secure retirement.
We monitor the performance of several hundred investment products including mutual funds, stocks, annuities, bonds, CDs and Exchange Traded Funds (ETFs). We concentrate on successful long-term risk/return characteristics typically through a “buy and hold” strategy.
On a quarterly basis AFS’ investment professionals meet to review strategic model portfolios allocations. This top-down approach combined with specific client suitability creates individual portfolios that can be categorized by:
1. Broad exposure to equities (including large cap, mid cap, and small cap stocks, international, REIT, etc.). In addition we monitor style indices to determine if style should have any impact on our portfolio allocations.
2. Determining the appropriate sector weightings. In most cases we benchmark our client?s equity portfolio weightings to the sector weightings in the S&P 500 Index®. We strive to add value (alpha) through individual security selection.
3. Macro economic indicators tend to support our decisions on fixed income investing. Fixed income is a very broad category but the major components of our portfolios tend to be CDs, money markets, treasuries, short or intermediate high quality bonds or bond funds, and in some instances high yield bonds or bond funds.
Click here to see a sample of our portfolio construction. However, please be aware that through this example AFS is not implying that this chart or formula, by itself, can be relied upon to make investment decisions.
