What is your advisor or broker’s investment style?

Minich MacGregor Wealth Management

What is your advisor or broker’s investment style?

For many people, the answer is “I don’t know, but as long as it makes me money, I’m good.”  This is not a horrible answer. However, one problem with not knowing is the element of SURPRISE. People do not like surprises when it comes to their portfoliosYou may be surprised at what does (or does not) happen in your portfolio during certain market conditions if you do not have a basic understanding of the investment style the person you entrust with your money uses. 

Investment style and portfolio management strategy can be a complex subject and not one you are likely interested in spending years learning.  After all, that’s why you hire an advisor. Let’s look at a typical bear market pull-back.  We all know they happen, remember 2008 and 2001?  If you are using a passive style and the market drops 30% over 6 monthsSURPRISE!

Your portfolio value drops too and depending on your allocation, the drop may be pretty significant.  You may be a bit upset because your advisor didn’t “do anything” about it. However, since the investment style is passive and based on a buy and hold mentality, you really should not have expectedmuch activity.   If your advisor’s style was more active, you may have been able to expect a different set of actions.

Our investment style is often referred to as “momentum investing”, which is an active management style.  The actions we would take in a portfolio during that same bear market event may be very different than the passive example above.  This is not to say that an active investment style is always better, but statistics show that momentum investing can provide consistent results when compared against other styles or a passive index like the S&P 500. 


The bottom line is: if you understand a little bit about the investment style of your advisor or broker, you are more likely to have your expectations met rather than… SURPRISE!

If you would like to learn more about our firm’s active investment strategy, consider coming to one of our monthlyworkshops or simply contact us for a consultation. We would be happy to discuss it with you.