Western Wealth Group

Growing Wealth

Growing your wealth at a rate which outpaces inflation and taxes is indispensable to becoming a successful investor. While discipline, wise investment choices and careful planning are all vital factors in achieving that growth, mitigating the loss of capital is equally important and yet rarely emphasized.

As losses increase, the upside return necessary to recoup those losses increases exponentially. For example, a loss of 25 percent takes a 33 percent gain to get back to break-even, and a 50 percent loss requires an astonishing 100 percent gain to recoup those losses.

Many investors were still trying to recover from the Mar 2000 through Dec 2002 period when the market dropped more than 50% yet again, from Oct 2007 to Mar 2009, leaving them with negative returns for over a decade. By contrast, many investors who were properly allocated and well diversified had positive returns over the same tumultuous decade.

Let our firm help you change the way you think about “making more through losing less!”

Western Wealth Group | Mitigating Risk

Mitigating Risk

At Western Wealth Group, we believe there are many effective ways to mitigate risk in your portfolio:

  • First, never take on more risk than you need to accomplish your stated goals. Studies have shown that reaching for return and yield is a common culprit in under-performing target returns and benchmarks.
  • Second, choose inexpensive, cost-effective and tax-efficient investments. This translates into keeping more of what you earn.
  • Third, build a prudently allocated, well-diversified portfolio utilizing each of the four major asset classes: Equities (stocks), Fixed Income (bonds), Cash (money markets, savings, checking, CDs) and Alternative Investments. Our analysts then break these broad asset classes down into more discrete investment categories which must be considered.
On the equity side, this may include exposure to:
  • Large, mid and small company stocks;
  • Value and Growth type stocks
  • Irrevocable Life Insurance Trusts
  • Stocks in different sectors or industries
  • Domestic, International, and Emerging Market stocks
On the fixed income side, this may include exposure to:
  • Corporate and Government bonds
  • Taxable and Tax-free municipal bonds
  • Domestic and International bonds
  • Short, Intermediate and Long-term maturity bonds
  • Treasury Inflation Protected bonds (TIPs)
  • Specialized fixed income, including floating-rate bonds, interest rate hedged bonds, high yield bonds and preferred securities.
For alternatives, this may include exposure to:
  • Long/Short funds
  • Option-income strategies
  • Investment Real Estate
  • Closed-end funds
  • Commodities
Western Wealth Group | Portfolio Construction

Portfolio Construction

Western Wealth Group builds the core of your portfolio with ETFs – Indexed-based investments which track areas of both the stock and bonds markets. ETFs have the added advantages of being well-diversified, low-cost, and are tax-efficient – important benefits to any portfolio. And, just as it is vital to achieve the appropriate allocation of stocks, bonds, and cash for your portfolio, it is likewise imperative to know which ETFs to own, when to own them, and in what proportions. This, of course, is what your Advisor at WWG will do for you.

Research has consistently revealed that using only individual securities in a portfolio – often in an attempt to “beat the market” – frequently leads to long-term under performance compared to the broad market indexes. By contrast, using low cost, index-based, investments in your portfolio typically leads to better performance and less downside risk.

Western Wealth Group | Ongoing Discipline

Ongoing Discipline

Successful investing to reach your financial goals takes discipline and consistency. Once your portfolio is constructed, your Advisor monitors and periodically re-balances your portfolio to keep your portfolio aligned with your risk/return parameters. This involves taking profits when certain investments have run up in value (i.e., “selling high”), as well as adding to areas of your portfolio which have decreased in value (i.e., “buying low”). Adhering to this discipline over time is at the core of our investing philosophy. Now, let’s begin building your future!