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1. Gathering Information
We begin by listening to our clients. We take the time to thoroughly understand our clients’ financial background, investment objectives, income needs, growth needs, risk tolerance, and time horizon.
2. Developing The Plan
Every client has a customized Investment Policy Statement (IPS). This IPS details how the portfolio should be managed, given the client’s unique investment objectives and constraints. The IPS details how the portfolio should be allocated among various asset classes, while also outlining the other key pieces of a client’s financial plan. This can include tax and estate planning issues, college funding, long-term care, life and disability insurance details and charitable giving, to name a few. The IPS is updated at least once a year or more often if client circumstances change materially.
3. Portfolio Construction
Each portfolio is allocated to satisfy specific investment objectives and constraints. Client portfolios often have a targeted weight for cash, equity and fixed income investments. These allocations are continually monitored and portfolios are dynamically rebalanced when significant deviations occur.
Equity investments consist of exchange traded funds (ETFs), and when appropriate, individual common stocks. Fixed income investments commonly consist of a diversified ladder of individual bonds. However, fixed income ETFs are used when cost effective diversification cannot be obtained using individual bonds.
4. Plan Execution
Plan execution includes portfolio management, but can also consist of various other aspects of a client’s financial life. This can include retirement plan funding for small business owners, making sure that various types of insurance policies (life, disability, long-term care) are adequate and appropriate, or making sure that an estate plan is in place to facilitate efficient generational wealth transfer. While we don’t file tax returns, sell insurance or compose legal documents, Sigma is willing to work side-by-side with our clients’ other trusted advisors.
5. Ongoing Review and Communication
Every client at Sigma works directly with their investment advisor. Clients can expect frequent communication with their investment advisor via emails, phone calls or in face-to-face meetings. Each client receives a quarterly package which includes a comprehensive report on their portfolio. Clients also have access to all of their account information via our secure website. For those who desire more insight into our investment thought process, Sigma’s investment committee publishes a blog and a monthly newsletter.