The term "Financial Planning" is used frequently in the investment business. Unfortunately, it is hard to pin down an exact meaning of the term. At ProFutures, we have a very clear idea of what Financial Planning should be. We call it the ProFutures "Dynamic Allocation Program" , and it does not try to be all things to all people. Rather, we define our approach to financial planning as follows:
Provide investment management services that help investors meet their personal financial goals through the use of suitable diversified investment strategies.
While many investment advisory firms seem to be influenced by the prevailing investment winds generated by the financial media, we at ProFutures believe that there is no specific investment strategy that works best at all times and in all market conditions. Buy-and-hold tends to work well during stable, upward-trending markets, and active management tends to work better in more volatile and sideways-trending markets. Alternative investments, where suitable for the investor, are generally not correlated to the financial markets, so they are valuable for diversification in any market.
We believe that diversifying your assets over a range of different investment strategies puts the investor in a position to potentially take advantage of any kind of market conditions.
Some aspects of our Dynamic Allocation Program are similar to those used by other financial planners. Yet where we differ from the rest of the pack is in our ability to not only diversify a portfolio among various asset classes, but also to be able to diversify among different investment strategies. We typically incorporate the following investment strategies in the portfolios of our clients:
Asset Allocation Using Absolute Return Portfolios
Active-Management Investments Including Market-Timing and Rotational Programs
Alternative Investments Including Hedge Funds and Professionally Managed Futures Funds
Throughout the 1990's, the common mantra of the large brokerage firms was that different investment strategies were not necessary. All you needed to do was buy-and-hold, and "buy more on the dips." They cited studies to show that active management didn't work, and that buy-and-hold was the only way to go. The buy-and-hold mentality became almost like a religion to many brokers and financial planners, and they were lucky enough to have the market to prove them right -- for a while.
However, after the 2000-2002 bear market in stocks, many of these same companies started saying buy-and-hold was a losing strategy, and that investors should consider market timing and alternative investments. Were they right before, or are they right now? Perhaps the answer is that it is futile to try to identify a single investment strategy that works all the time.
The Dynamic Allocation Process
Financial Planning is not like a mutual fund or stock that can be selected from a brokerage firm's list or on an Internet website. Rather, Financial Planning is a process that depends upon communication and trust. Therefore, it is logical that the first step in the Dynamic Allocation process is to obtain information about your financial goals, expectations, risk tolerance and current situation. We do this by using our Confidential Investor Profile.
This questionnaire provides us with information about your current financial situation, as well as your answers to questions that allow us to determine your risk tolerance and suitability for various kinds of investments. Obtaining this information is critical to the successful completion of a financial plan. That's why it is important for you to know that you can trust us to never sell or otherwise share your personal financial information with anyone else. We never have done this and we never will. Your confidential personal information stays just that -- confidential!
Once we receive your completed Profile questionnaire, one of our Investor Representatives will review your information and contact you if there are any questions. Then, by combining state-of-the-art computerized analysis and extensive personal experience, our Investor Representative will prepare a financial plan designed to fit your specific needs, financial goals, and risk tolerance.
The financial plan presented by our Investor Representative may include any or all of the various investment strategies discussed above, depending upon your needs and suitability. The investments recommended are chosen from among the vast population of professional money managers, mutual funds, and alternative asset managers using ProFutures' extensive experience in investment due diligence.
ProFutures continues to monitor the performance of all recommended investments and Advisors to be sure they continue to meet our high standards. We are also constantly on the lookout for new professional managers, and we perform extensive due diligence on new candidates prior to recommending them to our clients.
You can also count on our Investor Representatives to tell you if your current portfolio is sufficient to meet your goals, or if none of our investment products are suitable for you. All of our Investor Representatives are on salary, not commission. Thus, you will never be encouraged to sell existing assets to invest in our products unless it is clear that doing so will put you in a better position to meet your future financial goals, or to be more in line with your risk tolerance.
To recap, the ProFutures Dynamic Allocation Program has the following advantages for anyone needing investment management assistance:
Diversification among different asset classes AND among various investment strategies (unlike most traditional financial planners);
Experienced Investor Representatives who have only YOUR best interests in mind;
On-going monitoring of investment programs;
State-of-the-art computer systems and trading platforms to assist the Investor Representative in formulating and implementing your personal financial plan;
Timely reporting and ongoing communication;
Confidentiality of your personal financial information.
In light of the stock market's volatility over the last several years, more and more investors are realizing they need the assistance of professionals in designing their personal investment portfolios. The ProFutures Dynamic Allocation Program is specifically designed to meet that need.
If you would like more information about the Dynamic Allocation Program , click here . If you would like to go ahead and start the process, you can download the Confidential Investor Profile (Adobe Acrobat) and send it to us to get the ball rolling. If you have questions or would like to speak with an Investor Representative, give us a call at 800-348-3601 or e-mail us at mail@profutures.com.
ProFutures Capital Management Form ADV Part II
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