Ironwood Investment Counsel’s investment strategies are actively managed and built on the foundation of risk reduction and tax efficiency.
We create an asset allocation for each client. Portfolio contributions and withdrawals, time horizon, risk tolerance and other unique constraints all help define a proper asset allocation strategy.
We utilize a core-satellite approach for asset allocation. This method seeks additional return opportunities while attempting to better control risk. The core strategies, which we manage on a proprietary basis, provide exposure to more efficient asset classes that are representative of the market for core equities and fixed income. For less efficient asset classes, we use satellite strategies focused on areas where outperformance is likely and/or areas that are less correlated with global equity and fixed income markets. These two strategies, in combination, should provide risk reduction and return enhancement.
PROPRIETARY MANAGEMENT OF CORE ASSETS
We actively manage the core equity and fixed income components of a portfolio. The use of individual equities, fixed income, and preferred securities allows more control over the portfolio design, improves tax efficiency and an unnecessary layer of cost. The core investments may include:
- Large cap equities
- FIXED INCOME
- Tax exempt municipal bonds
- Taxable municipal bonds
- Corporate bonds
- Preferred securities
The core securities selected often have the following characteristics:
- Understandable business fundamentals.
- Possess sustainable competitive advantages and/or offer essential services or products.
- High quality earnings that lead to cash flow centric investments.
- Operate in oligopoly or niche settings.
We utilize separate account managers, institutional class mutual funds, and exchange traded funds to gain exposure to satellite asset classes that are critical to portfolio diversification. Most of the managers selected share similar investing philosophies with our core management approach.
Investment managers are selected based on screening criteria that is both quantitative and qualitative. More specifically, they are ranked within their peer group, with an emphasis on risk and return measures. We utilize these investments for the following asset classes:
- International equity
- Domestic small/mid capitalization equity
- Emerging market equity
- High-yield fixed income
- Absolute return
- Hedged and opportunistic equity
- Real estate
Ironwood Investment Counsel provides performance measurement that allows clients to evaluate their individual results. We are able to measure performance relative to long-term goals, appropriate market indexes and peer results.
We take a comprehensive approach to strategic planning. We consider our clients’ short and long-term cash flow needs, as well as their income and estate tax situations in creating a strategic plan aligned with their objectives.
We validate the strategic planning process through cash flow analysis and by testing long-term outcomes over varying market conditions. We also rely on balance sheet analysis to evaluate the appropriate mix of assets and liabilities relative to client objectives.
We are focused on after-tax results. We work with our clients’ tax advisors to integrate their investment portfolio and other assets with their income tax landscape.
We consider the level of taxable income, amount in tax-deferred accounts and capital gain and loss positions in executing and managing a well-constructed after-tax approach.
We understand that clients need an estate plan that ensures their specific objectives are carried out. We work with our clients’ attorneys and other professionals to develop a solution that includes the essential components of an estate plan.
We are familiar with wealth transfer techniques and ensure that clients’ estate plans are well integrated with their strategic plan, investment portfolio and other assets.
We assist our clients in evaluating non-market risks relative to their objectives. We then analyze existing insurance coverage relative to the risks revealed and coordinate specific strategies.
We do not sell insurance products. Where appropriate, we may recommend the use of life and disability insurance, long-term care insurance and property and casualty insurance.
We believe education costs for dependents represent a substantial liability for some clients. We coordinate comprehensive education funding solutions.
We assist our clients by implementing an overall strategy which may include 529 plans, education savings accounts and individual retirement accounts. We monitor the strategy and provide ongoing recommendations.
SINGLE STOCK DIVERSIFICATION STRATEGIES
We help clients in diversifying closely held business interest and concentrated common stock positions in meeting their objectives with less risk.
We also provide recommendations for how clients reduce risk and minimize the tax liabilities associated with various monetization strategies.