Our investment management services bring the best ideas from the world of academic finance to the individual investor. We begin by listening carefully to understand your financial situation. What are your priorities and concerns? What are your future spending needs? Where do you see yourself in five, ten or twenty years? Our aim is to design an optimal strategy for growing and protecting your assets tailored to your specific goals and aspirations.
Our investment philosophy is grounded in economic theory and backed by decades of empirical research. We use an approach called evidence-based investing to bring academic research to the world of personal finance. The key components of evidence-based investing can be summarized as follows:
1. Markets work
The stock market is an efficient information-processing mechanism that rapidly incorporates the views of millions of participants in real time in order to set stock market prices.
2. Do not try to outsmart the market
The efficiency of market prices makes it difficult for investors to outsmart other market participants through stock picking or market timing. A better approach is to emphasize areas of the market with higher expected returns. For example, small cap and value stocks have outperformed the overall market averages over long time periods. Capitalizing on the momentum effect in stock prices and focusing on high profitability companies may also help to maximize returns over the long run.
3. Resist chasing past performance
Many investors choose money managers or investment funds based on their recent returns. Unfortunately, past performance alone provides little or no insight into how the fund or money manager will do in the future.
As an independent investment advisory firm, we have no incentive to sell a particular brand of mutual fund or annuity. We offer objective analysis and advice based strictly on your needs. In other words, our allegiance is to you, not to any specific fund group or insurance company.
The Big Picture
To provide sound financial advice, we must understand how all the investments in your portfolio fit together. This differs from other approaches that look at investment accounts independently. By coordinating the management of different segments of your portfolio, we can optimize overall asset allocation and maximize tax efficiency.
Take a Long-Term View
You don't need to "time the market" or "beat the market" to succeed. In fact, these strategies can be harmful to your financial health. It is much more productive to harness the power of the market to attain your financial goals over the long term.
Fees and Taxes Matter
Fees and taxes have a major impact on long-term portfolio performance. At Shearwater Capital, competitive costs and sophisticated tax-minimization strategies are used to boost your after-tax returns.