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Maintaining Our Disciplined Investment Process

Brian Sommers, CFA


Clients may be wondering what HBKS is doing with our investment management portfolios in response to the market volatility, so we’re happy to share the following. The HBKS investment philosophy prepares our clients’ portfolios so they don’t have to be reactive to the current market conditions. Our clients’ portfolios are diversified across asset classes, maintain a global diversification, leverage both active and passive investments where appropriate, and utilize alternative investments as an additional tool for risk management. Above all else, the discipline to remain invested and not veer from your stated risk tolerances and time horizon are what become most important at times like this.

That doesn’t mean we advise our clients to take no action, it means we have already prepared their portfolios for market volatility. Over the past 18 months, as the global economic cycle was entering its late stages, we made multiple changes to our clients’ portfolios to prepare for a potential downturn in stocks. We shifted from high growth companies and into companies with a higher quality of earnings. We shifted money into funds that buy stocks that exhibit a lower volatility in price. Certainly while no one expected this precise set of circumstances or level of volatility, these changes allow us to help our clients weather this storm and properly position for the market recovery.

At HBKS, our advisors are looking for opportunities for tax loss harvesting. At some point over the next few months, it may make sense to rebalance our clients’ portfolio back to the targeted allocation, which would shift more of their assets into the equity market. Our asset management team is prepared to make this shift in order to take advantage of the discounted equity markets.

During this scary time in the markets it is more important than ever to have a disciplined process that relies on having the appropriate long term strategic allocation and not try to time an exit and subsequent entry back into the markets.

The information included in this document is for general, informational purposes only. It does not contain any investment advice and does not address any individual facts and circumstances. As such, it cannot be relied on as providing any investment advice. If you would like investment advice regarding your specific facts and circumstances, please contact a qualified financial advisor.

Any investment involves some degree of risk, and different types of investments involve varying degrees of risk, including loss of principal. It should not be assumed that future performance of any specific investment, strategy or allocation (including those recommended by HBKS® Wealth Advisors) will be profitable or equal the corresponding indicated or intended results or performance level(s). Past performance of any security, indices, strategy or allocation may not be indicative of future results.

The historical and current information as to rules, laws, guidelines or benefits contained in this document is a summary of information obtained from or prepared by other sources. It has not been independently verified, but was obtained from sources believed to be reliable. HBKS® Wealth Advisors does not guarantee the accuracy of this information and does not assume liability for any errors in information obtained from or prepared by these other sources.

HBKS® Wealth Advisors is not a legal or accounting firm, and does not render legal, accounting or tax advice. You should contact an attorney or CPA if you wish to receive legal, accounting or tax advice.


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