Our Process » Benefits of Active Management

Asset Allocation Should Not be a One-Time Decision

Markets change as much as we do, so the investments you have chosen years ago may no longer be the appropriate option for your financial future.

Take a look at the chart below, which shows 5-year annualized returns for several different categories of investments. The green bars reflect 1995-2000 returns, while the blue bars show returns from 2001 through 2005. After seeing this chart, would you be comfortable holding the same portfolio for both time periods?

Categories of Investments

All Stock Investments are Not Created Equally!

Believe it or not, but not all stocks experienced a bear market from 2000-2002. Sometimes even a small shift in investing styles can help protect you from potentially devastating losses. Still not convinced? The chart below plots a hypothetical $10,000 investment in either small value stocks or large growth stocks from 2000 until the end of 2002. Just this small shift from companies with large market capitalizations to smaller ones saved almost $8,000 on that initial $10,000, a difference between a gain of 24% and a loss of 55%!

Categories of Investments

Indexes are unmanaged and cannot by invested in directly. Returns represent past performance, are not a guarantee of future performance, and are not indicative of any specific investment. The iShares Russell 2000 Value Index Fund seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the small capitalization value sector of the U.S. equity market, as represented by the Russell 2000 Value Index. The index represents approximately 50% of the Russell 2000 Index. The iShares Russell 2000 Growth Index Fund seeks investment results that correspond generally to the price and yield performance, before fees and expenses, the small capitalization growth sector of the U.S. equity market, as represented by the Russell 2000 Growth Index. The index represents approximately 50% of the Russell 2000 Index.

Discipline, Protection, and Flexbility: The Keys to an Active Management Program.

PageOne Financial offers our clients an active approach to asset management. We believe our approach offers the following benefits:

  • Discipline
    Too often, investment decisions are affected by emotional reactions to events rather than a logical, systematic process. Emotions cause investors to make bad decisions. We offer that discipline to our clients through vigilant research and constant monitoring.
  • Protection
    On a best-efforts basis, PageOne Financial's primary goal is to protect client assets from prolonged market downturns. We don't chase returns and we're not looking for the latest investing "fad". We believe it's as important to protect assets during a market downturn as it is to capture potential market upturns.
  • Flexibility
    In most of our programs, we have the ability to take a very conservative posture - we can be 100% invested in the money markets - when we believe that capital preservation is the best option for our clients.

Index Definitions:

  • 3 Month T-Bill:
    As tracked by the Wall Street Journal, this benchmark measures the yields of bank-sponsored certificates of deposit.
  • Lehman Brothers Aggregate Bond:
    Govt/Credit Index, the Mortgage-Backed Securities Index, and the Asset-Backed Securities Index.
  • Standard & Poor's 500:
    A market capitalization-weighted index of 500 widely held stocks often used as a proxy for the stock market.
  • CSFB High Yield:
    An unmanaged, trader priced index constructed to mirror the characteristics of the high yield bond market. The index includes issues rated BB and below by S&P or Moody's with par amounts greater than $75 million. Preferred issues, US dollar denominated foreign issues and 144A securities meeting the above condition are also included.
  • Dow Jones Real Estate:
    This index consists of companies included in the Dow Jones Global Universe Index that derive their primary revenue from the real estate sector.
  • Dow Jones Technology:
    This index consists of companies included in the Dow Jones Global Universe Index that derive their primary revenue from the technology sector.
  • MSCI EMF ID:
    A capitalization-weighted index of stocks from 26 emerging markets that only includes issues that may be traded by foreign investors.
  • Russell 2000 Index:
    Consists of the 2000 smallest companies in the Russell 3000 Index.
  • Russell 1000 Growth Index:
    Tracks the companies within the Russell 1000 with higher price-to-book ratios and higher forecasted growth values.
  • Russell 2000 Value Index:
    Tracks the companies within the Russell 2000 Index that have lower price-to-book ratios and lower forecasted growth values.