Preserving established portfolios to maintain your lifestyle

For decades, CWM has focused on risk-adjusted investing to support Real Returns for clients, and we believe this continues to be the best approach for individuals who are in the preservation and distribution phases of life.

Our Risk-Adjusted Models (RAM) are optimized for clients who are getting close to retirement – or are already enjoying their work-optional lifestyle. They’ve built their portfolios through hard work and intentional saving, and want to be able to count on their investments to see them through the golden years. The RAM strategy allows for reasonable risk to help increase wealth while preventing against major losses that might come with extreme market declines.

For investors at any life stage, RAM can also be used for short to medium term needs such as an “Emergencies and Opportunities Fund”. This may include money set aside to cover the loss of a job, create a bridge during a life transition, and more.

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No investment strategy can guarantee a profit or protect against loss. Investing involves risk including the potential loss of principal.

Risk-Adjusted Models

In Action

Why is it important to protect against downside losses – even if it means we may not capture all the upside potential?

The math is simple: 50% – 30% = 5%. At least, that’s true when it comes to investment returns – and it illustrates one of our core tenets: limiting large losses is more important than participating in all potential gains.

For example, an investor who starts with $100,000 and achieves a 50% gain now has $150,000. Then they suffer a loss of 30% – and that $50,000 gain is almost entirely wiped out, leaving the investor with just $105,000. But if the same investor gains 25% on the original $100,000 and then loses only 15%, they net $6,250 – an extra $1,250.

That’s why, under the Risk-Adjusted Model, we actively manage portfolios to reduce volatility and keep risk low, focusing on investments in best-of-class exchange-traded funds and mutual funds. We design portfolios for account longevity, closely managing risk and market opportunities to help clients achieve their goals and focus on preserving funds for when they’re needed most.

Target your Real Return

Schedule a complimentary, no-pressure phone call with a CWM financial advisor today.