Investment Planning Process

5 Key Investment Principles

Many financial advisors work with their clients to develop an investment strategy that guides their investment decisions. The problem is that many investment strategies are developed in isolation as a means to an end, which typically centers on investment performance with less concern for the client’s long-term objectives. This can lead to investment decisions based on short-term outcomes that have little impact, if any, on long-term objectives, and that often leads to underperformance.

At Winship Wealth Partners, we work with our clients to develop long-term investment strategies based on academic principles and practices that instill the confidence clients need to be able to adhere to their strategy. The key tenant of Winship’s investment strategy is that “markets work.” When this important tenet is understood and embraced, clients are better able to ignore the swirl of noise and macro events of the day to stay focused on their long-term objectives. It also helps them avoid the common behavioral traps that snare many investors, such as chasing performance, following the herd at the top or bottom of the market, or trying to time the market.

To help our clients better understand this important premise, we keep them focused on the core, underlying laws of investing, including:

• Beating the markets is virtually impossible
• Risk and return are related
• Diversification is the key to reducing volatility
• Building your portfolio around your tolerance for volatility
• The importance of a long-term approach to investing