One of the differentiators of our firm, is how we truly diversify our clients' portfolios. Many investors feel they are diversified, but upon a detailed review, we show them that they are not truly diversified, as we define this concept.
Further evidence of the benefits of such diversification were provided over the past 10 years. As stated in a WSJ article, "stock returns calculated off the broad-based indexes have been horrendous over the last decade." They are referring to a portfolio that was made up of mostly large US companies, such as would be found in the S & P 500.
"Those who bought value stocks during the tech bubble... have done much better. From December 1999 through July 2010, the Russell 3000 Value Index returned 35% cumulatively, while the Russell 3000 index of all stocks still showed a loss."
When we structure a portfolio, we emphasize value stocks and broad global diversification. In the long run, this should provide our clients with a more successful investing experience.
Are you truly diversified? Do you know?
Source: "The Great American Bond Bubble," The Wall Street Journal, August 18, 2010
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