Investment Management
Our Discipline
Preserve and Enhance Capital
We provide total asset management. Our goal is to deliver attractive returns in both up and down markets, which distinguishes us from other wealth management firms.
It’s not what you earn. It’s what you keep.
Risk Management and Reducing Volatility
Excelsia has developed an investment process that demands extensive knowledge of clients, markets and the risk/return characteristics of defined asset classes. Prior to the investment of a single dollar, we engage our clients in a comprehensive interview process. It is important that we understand and embrace our clients’ goals and priorities first.
We identify and manage risk through the implementation of a defined methodology, which historically has provided higher returns given incremental levels of risk. Identifiable client tolerance to risk and to the variability of returns is codified in each client’s investment policy statement.
Asset Allocation Process
The Most Important Decision in Investment Management
Proper drafting of each client’s written investment policy statement (IPS) is critical and is the first step in our investment process. This single document is the blueprint for our clients’ investment program. We view the IPS as the governing document; the score card for managing our clients’ capital.
Once client tolerances and objectives are adequately identified, we implement the investment strategy. Excelsia utilizes eight traditional asset classes with additional allocations to pre-screened alternative investments. Systematically, we compare the relative value of the defined asset classes and actively allocate our portfolios from what is considered an overvalued asset to those assets that are undervalued within a timely, logical and unbiased framework.
We believe that a disciplined, dynamic portfolio management structure that identifies relative value among a broad range of asset classes can provide consistent, superior investment performance. As a result, our investment management process addresses three basic decisions of portfolio management – asset allocation, security selection and timing.
Portfolio Construction
In our opinion, investors spend far more time devoted to chasing yesterday’s top performing stock, sector, fund or manager rather than developing a sound strategic course based on their personal objectives.
Our dynamic process dictates that there are two primary choices to be made in any investment management program:
Strategic Decisions
Related to the asset allocation of the portfolio and based upon each individual’s specific investment objectives.
Tactical Implementation
The strategic decision applied through the use of various investment vehicles: Individual stocks versus mutual funds, indexed product (passive strategy) versus active investment management, hedge funds.
Excelsia utilizes a variety of investment vehicles including but not limited to individual stocks, bonds, mutual funds, external investment advisory organizations, commingled investment vehicles, common trust funds or exchange traded funds (ETFs). Excelsia maintains complete discretion over the funds and is subject to maintaining the fiduciary standards applicable to each account. Our goal is to effectively and efficiently implement the investment strategy.
We diversify our clients’ investments by both broad asset class (e.g. common stocks and fixed income securities) and sub-classes (e.g. within common stocks by economic sector, geographic area, industry, quality and size). Our purpose for ‘true diversification’ is to provide reasonable assurance that no single security, class of securities or investment may have a disproportionate impact on the aggregate results.
Excelsia has developed three disciplines that allow our clients to better understand our application of “mean/variance optimization”. Through the use of pre-identified conservative, moderate and growth portfolios we are able to execute client investment strategies in an efficient manner.
Our approach examines three variables for each investment selection:
Expected return
Standard deviation
Correlation
What distinguishes Excelsia from our competition is our discipline based on projected estimates of return, time weighted historical measures of risk, the correlation of returns for each asset class and active rebalancing. Asset allocation is dynamic at Excelsia and rebalancing is driven by market opportunity.
To ensure that our investment ship maintains its direction, we run and reallocate our clients’ assets no less than quarterly.
