Build Your Ship for the Biggest Storm

When a ship builder sets out to design a ship, he or she uses the best structural engineers available to ensure the integrity of the vessel. A well-engineered ship maneuvers confidently and will withstand even the biggest storm.

The same can be said of your investment portfolio and the financial advisor you select to “engineer” it. When the stock market becomes volatile, many investors become anxious and feel the urge to make changes in their portfolio. This anxiety is only compounded by the media, resulting in a cycle of “buying high” and “selling low” that is well documented in academic papers studying individual investor behavior. 

We must free ourselves of the hope that the sea will ever rest. We must learn to sail in high winds.”
— Aristotle Onassis

But oftentimes the wisest thing an investor can do in a market with volatility is absolutely nothing. The best way to weather these intermittent financial storms is by feeling confident in your investment portfolio and your overall financial plan in the first place.

Beware of advisors and firms out there who claim they can predict the future of the market - Phlox isn’t one of them. Instead, we build highly customized portfolios tailored for each client’s unique ability and willingness to bear risk.  Although we pride ourselves on being great listeners, we take an analytical, quantitative approach to managing the risk in your portfolio. As a result, clients have an appropriate amount invested in a mixture of stocks and lower risk investments. In this way, we engineer the financial “ship” that will weather the biggest storm—and keep your anxiety levels at a minimum when those storm clouds roll in. 

Disciplined, long term investment strategies created many of the iconic fortunes of our nation’s great history. A great financial advisor will help you maintain the long term perspective necessary to build wealth. 

We have to think of the future as a range of possible outcomes. We might bet on the one we think will happen, but we should give allowance for some of the others. Now, how much allowance, which of the others—these are the hard questions.”
— Howard Marks

How can we help you answer the hard questions about your financial future? Find out. 

 

Joe Martinez, CFA is the founder of Dallas-based Phlox Capital Management, an investment management and financial planning firm. You can read his commentary at www.phloxcapital.com.