In our Investment Advisory capacity, Regency Wealth Management is dedicated to the ongoing formulation, execution, rebalancing, and delivery of appropriate investment solutions designed to achieve your financial goals. After we conduct the discovery and review analysis clarifying your objectives, resources, and risk horizons, we construct an Investment Policy Statement (described below). Investments are made on a client’s behalf on a discretionary basis. Portfolio positioning and performance is reviewed regularly as are any changes in your financial situation, goals, or timing of key events. We typically meet with clients semi-annually.
Creating an investment strategy tailored to your financial goals involves many analytical processes and deliverables. These include:
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
- Review alignment of portfolio risk with client risk tolerance.
- Analysis of estimated potential losses at portfolio and security level
- Model and portfolio stress tests, via Bloomberg and other analytics, to 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
Investment portfolios typically consist of individual equities, bonds, open and closed end mutual funds, exchange traded funds, and other investment and savings products.
Our individual equity selection process is predominantly in the large capitalization stock space and uses a proprietary methodology, Quality at a Discount (QuaD), and has four main components:
- Leaders in their markets
Large, well-capitalized companies with strong management and leading market positions.
- Surplus Cash Flow
After meeting operating cash needs and capital spending, surplus cash flow allow distributions to shareholders via dividends and stock buybacks, or value adding acquisitions.
- Low Valuation
(Price/Cash Flow) as measured by a diligent review of financial statements to understand business and cash flows.
- 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.
The QuaD sleeve in a typical portfolio will have a core of 25 to 35 individual issues across numerous industry groups.
We also can include Fixed Income Securities in your portfolio. 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.
Fund, ETF and other investments
Regency uses numerous professional resources 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.
ESG Investing: Regency-CSI
R-CSI, Regency-Constructive Sustainable Investing, is our portfolio construction process incorporating environmental, social, and governance issues. We construct portfolios that consider:
- Regency relative scores (RRS) that collectively rank governance, sustainability, i.e. CDP, Carbon Disclosure Project, and the degree of ESG disclosures
- companies and funds that reflect constructive values, sustainable footprints, and reasonable investment opportunities.
This allows investors to align their lifestyles and values with their investments.
Regency Wealth Management reviews your investment portfolio regularly, modifying and rebalancing it when appropriate. Allocation changes may reflect:
- Changes in your goals or financial position that require portfolio modifications 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
- Approach of exposure limits as defined in the client’s Investment Policy Statements regarding minimum and maximum segment exposures
Your assets are held by a third party
Investments that you entrust to Regency Wealth Management are placed in custody with Fidelity Investments. With Fidelity, we know we are working with a provider that will maintain the highest level of integrity in providing brokerage and custody services — along with privacy protection — for your assets. Your assets are safeguarded because Fidelity has arranged for insurance protection beyond coverage through the Securities Investor Protection Corporation (SIPC). Investments are not guaranteed and may lose value.