Sometimes even the best of ideas are only good in theory because they are impossible to implement in practice.
When you see trading activity in your account, it generally falls into three main types of investment trades: raising or investing cash, rebalancing, and block trading.
For many of our clients, the idea that their portfolios should “never walk alone” is probably obvious enough.
When you need to withdraw cash from your investment account and you’re told the funds aren’t available, it can be a little unsettling, particularly when you know you have more than enough to cover the withdrawal. “What do you mean, the funds aren’t available? I can see them right there!”
The term portfolio management typically refers to investments and how assets are selected based on one’s time horizon and risk tolerance. This process of selecting the right allocation for your investments is essential for achieving a certain market return over time.
We are always looking for ways to improve the performance of our clients’ portfolios by providing high-quality investments while keeping fees low. All mutual funds and exchange-traded funds charge an expense ratio, which is the cost of operating the fund and includes the manager’s fee, as well as various other operating costs. These expenses are not the same as loads, so even a no-load fund has an expense ratio. While loads (sales commissions) are additional charges, expense ratios are internal costs that reduce the fund’s total return. We purchase no-load funds for our clients and endeavor to use funds with expense ratios that are low relative to peers. Still, within the universe of no-load funds, there are various share classes, each of which charge a different expense ratio. While an individual might be able to purchase a no-load fund directly from the fund family, the expense ratio for the available share class will be higher than for an institutional share class of the same fund. The latter is reserved for larger investors (or institutions with many clients) and generally has a large minimum investment requirement. In exchange for the higher minimum, the fund charges a lower expense ratio.
While a full-blown banking crisis is not likely, the recent Silicon Valley Bank failure provides a great opportunity to review your cash management strategy.
As a follow-up to the developing news on Silicon Valley Bank (SVB), we thought we would share some additional insight around questions we are hearing from clients related to FDIC insurance and the safety of their investment accounts at our custodians.
On Friday, Silicon Valley Bank (SVB) was seized by U.S. regulators after there was a run on the bank. This failure of the nation’s 16th largest bank raises several issues we want to address.
Preparing for the Turbulence
We have all been on flights where the pilot informs us that turbulence is ahead.