Step Four: Designing the Strategy
We apply the principles of diversification in the design stage by selecting an appropriate mix of asset classes based on the level of safety required. This is the most critical step in the Grant/GrossMendelsohn investment process. Numerous academic studies have demonstrated that over 90 percent of a portfolio’s total return is determined by "category" decisions while less than 5 percent comes from individual security selection.
Grant/GrossMendelsohn uses no preset formulas or asset allocation mixes. In order to be fully responsive to the client’s needs, we focus on establishing a strategy for each individual portfolio, controlling its level of risk, and matching a diversified investment strategy to the client’s expectations. Investment strategies for our clients are implemented using a combination of open- and closed-end mutual funds and exchange-traded funds, along with individual taxable and tax-exempt bonds.
By integrating tax planning with investment asset allocation, we can optimize retirement cash flow by properly structuring the combination of IRA distributions and other investment income. Charitable giving can also be designed to meet the goals of both the donor and the recipient.
