At StateTrust we are client-centric financial experts who provide advice based on a deep understanding of each client's financial needs.
One of our main goals is to establish long-term financial advisory relationships with our clients. We develop a personal relationship with each of our clients by understanding our client's attitude towards investing, including their risk profile and their investment objectives. We help our clients define and then achieve their financial goals.
For us, a successfully designed advisory strategy should be a natural outgrowth of providing financial advice that helps clients not only protect their assets but understand and fulfill their financial goals.
Advisory Process
At StateTrust, we follow an advisory process supported by specialized personal, as well as analytical and research tools. Our advisory process encompasses the following four steps:
- Client Profile: Gathering information to build up an up-close characterization of a client's existing wealth –investments, liabilities, tax profile, income, and expected wealth transfers. This information allows advisors to determine client's risk profile and preferences.
- Investment blueprint and solutions: Based on the above information, advisors devise an investment policy statement in conjuction with the client, which includes an asset allocation strategy.
- Agreement and Execution: Our advisors get input from client about the solutions presented. Once they come to an agreement, the next step is to execute the relevant transactions and ensure proactive maintenance.
- Review: Advisors revisit the client's risk and service profile periodically.
Risk Vehicles
Investors have to take into account different risk characteristics depending on the investments they choose to make. StateTrust's financial advisors are well informed on the facets of risk for different types of investments.
Objectives
As part of our exploratory and client profiling process our advisors need to help assess a client's financial goals and risk profile. To that end, we seek to understand several areas of your personal profile through a set of questions. Some of those questions will relate to objectives, current assets and liabilities, family structure, investment style and experience:
- What are you trying to accomplish?
- What is important to you?
- What do you currently own and owe?
- Have you determined your personal investment objectives?
- Have you put your investment objectives in writing?
- What is your biggest concern?
Risk Tolerance Levels
At StateTrust our investment plans are tailored to the growth and preservation of our client's assets. Higher volatility in investment returns will usually accompany higher returns for long term investments. Thus, clients are faced with a choice between return stability or higher long-term investment performance.
The scale below illustrates that if an investor desires high long-term returns, he/she must be willing to accept the high levels of volatility associated with the types of asset classes that produce such returns.
Portfolio
The following sample questions are aimed at establishing the reasoning behind a client's current portfolio. It is critical for StateTrust advisors to keep clients informed regarding financial decisions:
- Why do you own that particular stock?
- What is that fund doing for you?
- Why are you so heavily invested in bonds?
- What is the strategy behind your focus on (industry, sector, geographical region)?
- Is there a reason why you don't have significant international holdings?
- Do you consider your portfolio adequately diversified?
Assets, Liabilities, Income, and Expense
At StrateTrust, our financial advisors need to have comprehensive information about the assets, liabilities, current income and expenses of clients in order to tailor a successful strategy:
- Where does your current income come from?
- Do you have other sources of income? Trust funds? Alimony?
- Are you expecting an inheritance? From whom? Do you have any idea of a timetable?
- Do you have any assets that currently provide or will provide an income?
- What is your debt situation?
- How do you spend your money?
- What are your assets?
Investment Style
Through the following questions we get to understand our clients' investment profile and style:
- What kind of investor are you?
- How involved do you want to be with your investments?
- What are your primary sources of investment information and ideas?
- Do you consider yourself a conservative or aggressive investor?
- When investing, do you like to strike out on your own or follow the crowd?
- Which is more important to you, beating the market or meeting your goals?
Planning
Planning is a key process for us and our clients. Planning is the process at the center of sound financial strategy. The following questions are used in a preliminary assessment as part of our thorough and comprehensive process of investment planning:
- Do you have a financial game plan?
- When is the last time you reviewed your will and trusts?
- Are your life and disability insurance adequate?
- How prepared are you for a major catastrophe?
- Would your plan survive a major economic set back?
- Have you thought about the risk of dying soon?
- If you live a long time, is there a risk you will run out of money or have to reduce your lifestyle?
- What are your professional advisory relationships? Do you have confidence in your advisors?
At StateTrust, we know that investors face complex financial decisions everyday.
Due to emotional or short term decision-making, investors make investment mistakes. Some of these mistakes are a result of:
- Short-term Focus: Wrongly focused either on short term risk or on short term returns.
- Overconfidence: Having full assurance, without misgivings, in selecting investments.
- Erroneous Judgment: Perceiving trends where none exist. Taking action based on these inaccurate assessments.
- Mental Accounting: Seeing investments in an isolated way, while ignoring the total structure of the portfolio.