The CJM Investment Philosophy
Unless you are entirely new to the subject of investing you have probably heard this before: Equities consistently outperform all other investments over time. This is true, of course, but it does beg the question of why all investors do not do equally well in the capital markets.
The answer is that how you invest is just as important—if not more important—than where you invest. Ineffective diversification; failing to rebalance your portfolio with changing conditions; trying to out-guess the markets; and overactive trading that results in higher fees, more commissions, and excessive tax liabilities are just some of the ways in which the majority of investors sabotage the performance of their portfolios.
CJM Fiscal Management believes in the power of investing for the long term, and not in short-term speculation. The key is diversification across a broad range of asset classes—groups of securities that offer similar risk and return characteristics. We refer to this philosophy as "passive investing" since our clients are positioned to benefit from the inherent efficiencies of the markets as a whole. Our approach is based on Modern Portfolio Theory (MPT), the pioneering concepts developed by Markowitz, Miller and Sharpe that won the Nobel Prize in Economics in 1990. MPT provides a framework for analyzing and constructing a portfolio as a unified whole, mixing a variety of asset classes and alternative investments to achieve true diversification. The objective is to limit exposure to market volatility and balance risk, which tends to secure consistent returns over the long term.
The CJM approach to investing is described in greater detail in several white papers that may be downloaded from this site. If you would like to know more about the methods we use to secure a sound financial future for our clients while ensuring a legacy for generations to come.
