Are we on the right track with our strategic asset allocation strategy? That’s the question I’ll be looking at in detail in this month’s report. Our mission at Bonner & Partners Family Office is to help you protect and grow your family wealth. To do that, we provide expert advice on critically important matters such as family relationships, tax and legal strategies and family governance. But there’s also the investment piece of the equation. And this centers on how we strategically allocate our assets. This is one of the secrets of ultra-wealthy families.
Quarterly Strategy Report
In Japan, they are known as the Senkaku Islands. The Chinese refer to them as the Diaoyu Islands. In reality, they are five uninhabited islets and three barren rocks in the East China Sea… and they are the crux of rising tensions between the two Asian powers. Japan claims to have discovered the islands in 1884. China’s tenuous ownership claim is based on a 1403 Chinese navigational map that recorded them. The disputed ownership issue has been simmering for decades.
It began with a love of automobile racing… On returning home after serving as a lieutenant in the tank corps in World War I, French mechanical engineer Eugene Houdry turned his attention to his true passion: racing cars. During a visit to the US in 1922, Houdry went to see the Indianapolis 500. Watching Jimmy Murphy become the first driver to win the race from pole position, he realized that capturing speed was dependent on more than just mechanical engineering and advanced aerodynamics…
This month, a detailed look at what we believe is the single biggest determinant of long-term portfolio returns: asset allocation. Learn about the importance of asset allocation, and you have a good chance of preserving wealth over the long term. Ignore it, and your chances of preserving wealth drop to close to zero. You’re likely to have some resistance to the idea. Most people do. But preserving and growing long-term wealth is not about what stocks you buy, but about being in the right markets at the right time.
As I wrote in the October Strategic Review, Argentines can teach us a lot about financial survival. And I recommended that members who are US citizens adopt a strategy I call the “Reverse Argentine.” Argentines keep most of their real estate at home and most of their financial assets overseas.
This month, I want to make a new addition to the Value Beta Portfolio: a beaten-down emerging-market ETF I expect to deliver an average annual return of 12% over the long-term. I also want to make an important sell recommendation. After some changes by the fund manager, one of the ETFs in the Value Beta Portfolio isn’t doing the job we thought it would do when we first bought in. So it has to go.