But Aren’t All Investment Advisors Fiduciaries?

From time to time, we are asked about differences in standards of practice among various types of investment practitioners. Registered Investment Advisors (RIAs) that meet a threshold of assets under management are regulated by the SEC under the Investment Advisors Act of 1940 (the 1940 Act). Smaller RIAs are regulated by state securities regulators. Generally,… Read more »

Building Blocks Chart

The Building Blocks Chart is a pictorial depiction of the relative performance of asset classes over calendar-year periods. What’s the likelihood that last year’s winners will repeat? Should the investor avoid asset classes exhibiting recent poor performance? As the table illustrates, the relative performance of asset classes can shift dramatically from year to year. Investors… Read more »

Diversification Through Time

Investors have two basic options. They can concentrate their portfolios – in, say, the S&P 500 or U.S. Treasuries, or real estate – or they diversify broadly over a weighted cross-section of global stocks, bonds and real estate. Which strategy is more likely to produce better long-terms results? Which strategy is less risky? To investigate… Read more »

Change in Custody Rule for Assets

A No Action letter released by the SEC in February 2017 clarified its interpretation of the rule1 for asset custody. Quoting from a précis on the subject prepared by Fidelity Investments: The SEC has clarified that an adviser who has the power to disburse client funds to a third party under a standing letter of… Read more »

Observations on Risk Tolerance and Risk Capacity

The famous Temple of Apollo at Delphi—an important source of prophetic wisdom for the ancient Greeks—is well known for the two inscriptions on its portal: Know Thyself Nothing in Excess As several world capital markets continue to flirt with record high asset price levels, it is worth revisiting Delphic wisdom in order to prepare for… Read more »

Investment Publications: Patrick Collins et al.

A list of published articles on the topics of Asset Management, Trustee duties in portfolio design, monitoring and surveillance, Family Trust, Longevity Risk and Retirement Income Planning.   A Risk Primer for Investment Fiduciaries (with special attention to the management of endowment funds) – Patrick J. Collins, Ph.D., CLU, CFA, California Trusts and Estates Quarterly… Read more »

Cooking up a Diversified Portfolio

A diversified portfolio owns securities from various markets – the bond market, the real estate market, and the stock market. Additionally, a diversified portfolio benefits from geographic diversification. This means that it typically owns both U.S. and foreign securities. By contrast, a “focused” portfolio owns only a few securities – often within just one market…. Read more »

Portfolio Analytics

Portfolio Analytics provides technical information on the portfolio model used in your Investment Policy Statement [IPS]. The model employs historical returns, variances and asset class correlations for the period January 1973 through the end the previous year. The model focuses on the economic consequences of the strategic asset allocation decision. It does not take into… Read more »

Portfolio Management: Theory & Practice

Since our inception, the core mission of Schultz Collins has been to help investors make rational, informed and intelligent investment decisions. Prudent decision making, however, requires a basic understanding of capital markets and a familiarity with evolving research in the field of Financial Economics. In 2006, we published Portfolio Management: Theory and Practice to summarize… Read more »