Financial Planning


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The Financial Planning process is an interactive one that starts with developing clear goals and objectives and gathering all relevant data.  Regency’s analysis includes:

  • Cash flow and financial position analysis, summarizing and assessing income and expenses, key budgeting issues, and cash reserves for emergencies or future opportunities.
  • Funding specific accumulation goals, such as educating children or grandchildren, purchasing a vacation home or accumulating a targeted amount for some other purpose, through the development of an appropriate investment strategy based on your specific time frames and risk tolerance.
  • Income tax planning, including the identification of appropriate tax savings strategies that may be available in your situation
  • Retirement planning focused on evaluating needs and developing strategies for both the accumulation and distribution phases of life.
  • Risk management, which involves identifying potential risks, such as loss of health, property, income, or life; and developing appropriate strategies for protecting against these risks.
  • Estate planning & wealth preservation including the development of estate organization and distributions strategies that seek to assure that wealth is preserved and passed as efficiently and effectively to the people or organizations as directed by the client as to amount, timing, and manner.

Clients receive a written report, providing a detailed financial strategy.  Should a client choose to implement the recommendations contained in the plan, Regency will work closely with the client’s attorney, accountant, insurance agent, and/or other professionals.  Implementation of the financial plan recommendations are entirely at the client’s discretion.  If requested, Regency may recommend the services of other professionals that may facilitate implementation.

Click below to view the video providing a brief description of our Wealth Management System.


Investment Process

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After Regency conducts its discovery and review analysis clarifying client objectives, resources, and risk assessment, the following investment process is conducted:

Investment Policy Statement (IPS)

  • Set parameters for equities, fixed income and cash positions
  • Define investments’ quality standards
  • Specify benchmarks for measuring performance
  • Specify investment time horizon
  • Identify liquidity needs

Capital Markets Outlook (CMO)

  • Develop and  regularly update a Capital Markets Outlook that anchors strategic and tactical asset allocation decisions
  • Conduct economic analysis: global, regional, and local trends
  • Analyze valuations and volatility across markets
  • Consider historical analysis but incorporate forward thinking and common sense in developing conclusions

Stress Tests

  • Model and portfolio stress tests, via Bloomberg analytics, estimate potential losses under numerous historical scenarios
  • The system overlays past market action over the securities considered and uses the observed correlations between these securities over the last three years
  • Analysis of estimated potential losses at portfolio and security level

Security Selection

Investment portfolios typically consist of individual equities, bonds, open and closed end mutual funds, exchange traded funds, and other investment and savings products.

Fund, ETF and other investments

Regency utilizes numerous subscription and non subscription based services to identify, analyze, and monitor manager data.  Mutual fund and ETF managers’ selection incorporates the following criteria:

  • the fund’s performance history
  • the industry sector in which the fund invests
  • the total return and volatility record of the fund
  • the fund’s investment objectives
  • the fund’s management style and philosophy
  • the fund’s management fee structure

Regency also has access to numerous providers of “alternative” investment products including structured notes and hedge funds that are considered and used where appropriate.

Individual Equities

Our individual equity selection process is predominantly in the “large cap” space and uses a proprietary methodology, QuaD, Quality at a Discount.  It has four main components:

  • Leaders in their markets. Large, well-capitalized companies with strong management and leading market positions.
  • Surplus Cash Flow after operating cash needs and capital spending allowing them to serve shareholders via dividends and stock buybacks.
  • Low Valuation (Price/Cash Flow) as measured by a diligent review of financial statements to understand business and cash flows.  Our target is a minimum 10% surplus cash flow yield.  This equates to paying 10 times surplus cash flow for a publicly traded business with full liquidity.
  • Low Leverage (Debt) as this allows firms to have less reliance on capital markets and more financial flexibility to weather adverse business and economic cycles.  This also allows them the luxury to take advantage of strategic opportunities unavailable to more levered competitors.

QuaD Portfolio Construction

  • The QuaD sleeve in a typical portfolio will have a core of 25 to 35 individual issues across numerous industry groups
  • While we are cognizant of S&P 500 industry weightings, we do not manage to them and may not have stocks in each sector

QuaD Sell Discipline

  • Equities that  reach excessive valuations are sold and proceeds are redeployed into other more attractive opportunities
  • Sells are also prompted if cash flow weakens materially from expectations

Fixed Income

Fixed Income securities generally have some mix of interest rate risk, credit risk,  and spread risk.   Regency’s fixed income asset allocations consider all three as well as their relative value.

Relative value across sectors is compared and contrasted considering:

  • Segment analysis: Government vs. Mortgages vs. Corporate;
  • Quality review: Quality – Investment grade vs. High Yield (for clients that permit them) ; and
  • Coupons and maturities.

Interest rate and inflation risk are carefully considered.  Interest rate risk is usually measured by duration – price sensitivity to interest rate changes.  Portfolios are constructed  across the maturity spectrum and modified according to Regency’s expectations for near and intermediate term changes in the level and slope of interest rates and inflation expectations (as reflected in our Capital Markets Outlook).  In a normal, mid cycle interest rate environment a “ladder” of maturities (some bonds maturing each year) is built that allows short term, maturing securities to be reinvested at current rates. 

Credit Risk, usually associated with corporate bonds and to a much lesser extent municipal bonds, is a key consideration.  Credit risk is the risk of a default or nonpayment by the issuer.  In assessing this risk we consider the issuers’:

  • Competitive position
  • Economic cyclicality – sensitivity of earnings to the economy
  • Financial profile
    • earnings and cash flow, relative debt reliance (leverage)
    • margins and returns on revenues, assets and equity
    • Regulatory environment
    • Seniority, collateral or insurance (if any)
    • If tax exempt; type of bond (general obligation, revenue bonds)
    • Public ratings

Yield Spread Risk is the difference in yield between sectors of the bond market.

  • Supply and demand aspects are considered
  • Tax equivalent yield, if tax exempt
  • Specific bond provisions – is it callable, putable, refunding provisions,  floating rate or fixed rate, convertible, etc.
  • Prepayment risk  – mortgages

Notes on fixed income markets

Price volatility: Bonds with longer maturities and lower coupons generally have higher price volatility than those with shorter maturities or higher coupons.

Government or sovereign bonds  usually carry low credit or default risk but can at times reflect investor concerns about timely repayment (usually in foreign currency denominated bonds of emerging market countries).  Since our clients are US based, we consider US Government securities for individual bond purchases in this category.  The return on US government bonds are most sensitive to changes in the level and slope of interest rates.  US Government securities are highly liquid but offer the lowest yield reflecting low default risk.

Municipals exhibit a low incidence of default but are often less liquid than taxable bonds.  They are exempt from taxes for in state residents and usually exempt from Federal taxes.

Corporates and preferred stocks have a higher default risk but represent claims on the issuer’s business that are ahead of stockholders.

Portfolio Monitoring and rebalancing

Investment portfolios are reviewed regularly and modified as and when appropriate.  Allocation changes may reflect:

  • Changes in a client’s goals or financial position requiring modifications in  portfolios to realign risks and expected returns
  • Anticipated changes or observed deviations of economic, interest rate, or market volatility
  • Regency’s opinion on securities or funds changes, valuations reach our targets, or more attractive investments are identified
  • Accounts are rebalanced when exposure limits are approached as defined in the client’s Investment Policy Statements regarding minimum and maximum segment exposures