At PracticeCFO, our investment philosophy consists of a set of core principles and beliefs that provide a framework for the investment decision-making process. When put into practice, our investment philosophy becomes our investment strategy. The result is less taxes paid, more money in your account to compound and grow over time, and disciplined investing customized to meet your needs. All our portfolios are constructed with the following philosophy in mind:


“Diversify broadly, identify opportunities, avoid common pitfalls, keep costs at rock bottom, periodically rebalance, and remain disciplined.”


Diversify Broadly – We diversify to reduce volatility and maximize risk adjusted returns, commensurate with your risk tolerance and time horizon. The allocation of capital among asset classes (stocks, bonds, cash, etc.) and sectors (technology, consumer staples utilities, etc.) will have greater influence on the long-term portfolio results than any other factor.


Identify Opportunities – We use a hybrid investment management approach that combines passive asset management with tactical asset allocation. Low cost, passive exchange traded funds (ETFs) form the core of our portfolios. Tactical asset allocation may be used to capitalize on market opportunities. For example, we may overlay sector ETFs to take advantage of strong market sectors or increase the weighting of an asset class that we perceive to be undervalued.

Avoid Common Pitfalls – As your Investment Advisor, we can help you avoid costly mistakes. We keep you focused on the long-term investment objective so that you aren’t rattled by short-term fluctuations.


Keep Costs at Rock Bottom – Over time, high costs significantly erode your returns. With so many unknowns in the market, minimizing costs is one of the only guaranteed ways to boost portfolio performance. The average expense ratio for mutual funds is between .50% – 1%, many are much higher. Our portfolios have an average expense ratio of less than .15%. Further, we partner with the leading custodian in the Independent RIA space, Charles Schwab, so that your assets and data are secure and your trades are free. Charles Schwab has worked side by side with Independent RIAs for over 30 years. Below are some of the investment firms that PracticeCFO uses for low cost ETFs and Mutual Funds:

  • Vanguard
  • Charles Schwab
  • iShares
  • State Street (SPDR)

Periodically Rebalance – From time to time, market conditions may cause the portfolio’s asset classes to deviate from the desired allocation. These deviations leave you exposed to greater risk. We periodically rebalance your account, selling out of overweight positions and buying into underweight positions, so you aren’t overexposed.

Target Allocation                                      Current Allocation (with drift)


Remain Disciplined – We believe that markets are generally efficient. Therefore, it is virtually impossible to predict the market or time the purchase or sale of investments to “beat the market”. We take a long-term buy and hold approach, consistently buying dips, periodically rebalancing to get the portfolio back in line with the desired allocation and sticking to the long-term investment objective.

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