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The Investment Process
Asset Mix Strategies
A successful investment program demands a sound, well-defined strategy
that broadly outlines the portfolio objectives and sets the parameters
for investment.
As a starting point for discussion, Mulvihill Wealth Management has
outlined seven basic asset mix strategies for clients with $1 million
or more in investable assets. They range from very conservative to highly
aggressive with varying degrees of risk and return potential.
Once the approach has been determined, a portfolio of individual securities
and selected Mulvihill mutual funds is constructed based on the unique
needs of the client. For example, your stated preferences for blue chip
companies, or aggressive growth stocks, will be implemented. Specific
industries, or stocks, or both, can be avoided as you dictate. If
income is your objective, we’ll ensure your needs are met by holding
bonds, income trusts and dividend producing stocks to provide the cash
flow you require. This approach ensures each portfolio is customized for
each client.
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- Current income with an emphasis on safety of principal
- Money market investments and bonds
- Asset mix benchmark: 0% equities; 100% fixed income
- Very conservative; low risk and volatility
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- Current income with some growth of capital
- Money market and bonds for fixed income
- Some Canadian dividend-producing equities and income trusts included
- Asset mix benchmark: 30% equities; 70% fixed income
- Conservative; some risk and volatility
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- Balanced between current income and long-term growth of capital
- Split between fixed income (money market and bonds) and Canadian equities
(dividend producing stocks and income trusts)
- Some US equities included for diversification
- Asset mix benchmark: 50% equities; 50% fixed income
- Conservative with growth potential; some risk and volatility
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- Balanced between current income and long-term growth of capital
- Split between fixed income (money market and bonds) and Canadian equities
(growth oriented)
- US and International equities included for diversification
- Asset mix benchmark: 60% equities; 40% fixed income
- Balanced growth potential; more risk and volatility
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- Long-term growth potential with moderate income
- Mostly equities with some fixed income (money market and bonds)
- Larger percentage of US and International equities for growth
- Asset mix benchmark: 70% equities; 30% fixed income
- Growth potential; more risk and volatility
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- Long-term growth potential with some income
- Mostly equities with some fixed income (money market and bonds)
- US and International equities for growth
- Asset mix benchmark: 80% equities; 20% fixed income
- Greater growth potential; increased level of risk and volatility
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- Long-term growth of capital is primary objective
- Maximum equities with very little fixed income (money market)
- Canadian, US and International equities are held
- Asset mix benchmark: 95% equities; 5% fixed income
- Maximum growth potential; most risk and volatility
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