We guide our clients through the process of transitioning from accumulating assets to repositioning those assets for retirement. Our goal is to hit your long-term objectives with an asset allocation that is appropriate for your journey.
At Willis Johnson & Associates, we use a portfolio construction method called Core-Satellite Investing. This well-diversified fund index-based investment approach and manager-based approach, established by our Investment Committee, follows a very systematic process.
This well-diversified and manager-based approach, established by our Investment Committee, follows a very systematic process.
Core-Satellite investing is a method of portfolio construction designed to minimize costs, tax liability and volatility with the goal of outperforming the broad stock market as a whole.
The core of the portfolio consists of active and passive investments that track major market indices, such as the S&P 500 and generally makes up 50-70% of the portfolio.
Additional positions known as satellites are added to the portfolio, based on current economic opportunities and trends, and generally make up 30-50% of the portfolio.
We generate investment ideas using market research and analysis, studying market indicators, discussing the market with industry strategists and economists, and accessing research analysts from top financial institutions.
We then use a top-down security selection method that involves looking at the “big picture” in the economy and financial world and then breaking those components down into finer details in order to choose the most attractive equities and/or fixed income vehicles.
Our trades are then executed by an investment department that is independent of your wealth manager. Price targets are set in advance, watched closely, and traded on when the preselected criteria is hit.
It is important to reevaluate and rebalance portfolios in a proactive manner, also known as active rebalancing. As a result, we look for opportunities to sell equities when the market is overvalued, and look for buying opportunities when the market is undervalued. In addition, we have discretion over our clients’ accounts so that we can be opportunistic without the associated emotion.
Investing involves risk, including the potential loss of principal. No investment strategy can guarantee a profit or protect against a loss. There is no guarantee that a diversified portfolio will outperform a non-diversified portfolio in any given market environment. The S&P 500 (Standard & Poors Stock Index) is a stock market index containing the stocks of 500 American corporations with large market capitalization that are considered to be widely held. The S&P 500 is unmanaged and cannot be invested directly.
The Investment Committee and Trading Team at WJA meet every Tuesday, or as needed, to identify the pricing targets at which accounts should be traded. There is a dedicated back office team ready to execute as soon as the agreed-upon pricing targets are met. This two-pronged approach was put into place to ensure that all of our clients would benefit rather than potentially miss out on an opportunity due to our wealth managers being engaged elsewhere.