FSA Investment Group’s Process

FSA Investment Group’s Process:

FSA’s investment process consists of a two-pronged approach to asset management. First, we focus on the “bottom-up” approach with regards to understanding client’s expectations; second, we use a “top-down” approach to assess what effect the economic factors on the macro level have on our client’s expectations.

When a client chooses FSA as its investment advisor, it is essential that we understand the client’s expectations. Once we assess those expectations, we then determine the client’s ability and willingness to take on risk. Once we assess the willingness to take on risk, we then build the appropriate portfolio to meet the client’s expectations.

FSA utilizes strategic, risk-based models to build client portfolios which are divided between “growth” and “income” oriented investments.  For more aggressive goals, we allocate more to “growth” investments and for more conservative goals, we allocate more to “income” investments. Through the development of eight simple asset classes, we have made a complicated investment world seemingly straight-forward and comprehendible. FSA’s eight asset classes consist of the following:

These asset classes each have a strategic, long-term target allocation. However, markets and asset classes present opportunities through imprecise valuations which allow us to buy or sell investments at desirable prices. With that in mind, FSA will at times tactically shift portfolio asset allocations higher or lower based on valuation. This tactical approach includes holding cash when valuations do not warrant investment opportunities elsewhere. Holding cash when markets are overvalued is an important component in our investment philosophy, because we believe that overpaying for an asset can destroy long-term investment returns. 

In order to implement FSA portfolios, we will utilize outside money managers, individual securities, mutual funds, and exchange traded funds. Selecting investment management firms to manage assets successfully is one of the most significant decisions we make on behalf of our clients. We also limit the number of managers we recommend, which allows us to develop a deep, thorough knowledge of the managers we use. Additionally, we avidly maintain a research management database which allows us to capture pertinent research, record historical money-manager decisions, and avoid any managers who are not compatible with our philosophy.