Custom Portfolio Management

What is Portfolio Management?

Simply put, Portfolio Management is the disciplined process of increasing investment return while controlling and reducing risk for an investment portfolio. 

What kind of investor is best suited for Portfolio Management Services? 

Typically, Portfolio Management Services work best for clients who have at least $250,000 to invest. Although some Callaway clients who use these services are investing smaller amounts, we must be careful since the transaction charges can diminish the rates of return. In the past and in many current cases, larger investment account balances perform better. But now and with the new tools and services that we offer on this website, we can bring that number down from $250,000. We are always conscious of the costs to offer our services; technology has in some situations lowered the bar. Please complete the risk analysis and financial planning tools so that we can determine the best program for you. 

I’d like to invest in the stock market, but I know the risk is high. Can Portfolio Management remove the risk? 

Investment in the stock market always involves risk. But Portfolio Management helps reduce and control the risk through a buy-sell-hold decision model. And the risk is spread out over a diversified number of equities. 

If a bear market comes along, can we get out? 

You certainly can. In fact, our Active Portfolio Management System will often instruct us to convert to 100% cash under those circumstances. We consider cash an investment position. If the market is not moving up, I do not want to be in it. 

Does Portfolio Management tell me when to buy or to sell?

 Your portfolio manager at Callaway Financial Services monitors the system for signals to buy or sell. You do not initiate the trades, nor do you place the trades. 

How will I know what is going on with my investments? 

You will always be informed. We send out confirmations of all trades as they occur. You will receive detailed account statements quarterly, and if activity warrants, you will also receive monthly statements. And in today’s ever-changing technology we offer electronic notification via email of all trades and statements and offer online access to view your account on demand. No action is required of you unless, of course, you have questions or feedback. If you need to talk to us, we are there for you. 

How do I know if my portfolio is in balance?

The platform that we use automatically instructs Callaway Financial to re-balance the portfolio when it is time to reallocate. Based on the parameters you and your portfolio manager have worked out, our system will tell us which investments need to be reallocated, and by what percent. 

How accessible are my funds? 

There is no long-term contract, so your funds are always accessible. Callaway Financial does not levy surrender charges or penalties when a client withdraws the funds. We are caretakers of your money until you need it. 

How do I work with my portfolio manager? 

The portfolio manager consults with you to determine your financial liquidity and your tolerance for risk and volatility. There is a review of your investment goals and the allocation of your current investments. Every client is different, every client has differing risk tolerances, and such a consultation is essential to providing the right portfolio and the right management for you. Once we have set up your portfolio, you simply allow the program to work for you. 

If my investments are locked in a Variable Annuity or my 401(k), can you still manage my account? 

Yes, we have many clients who allow us online access to their accounts; we can manage the accounts wherever they are held. We construct a portfolio based upon the available funds or sub-accounts held in your Variable Annuity or 401(k). 

What is the difference between active and passive portfolio management? 

Passive portfolio management takes into consideration your risk profile, your age, your retirement or savings goals and amount to invest. Once we have all the information a portfolio of mutual funds for instance are selected. You stay invested in that portfolio for the long term unless your goals specify otherwise. On a quarterly basis the funds are reallocated based on the model portfolio to keep it in balance. With passive investing you buy and hold the securities and you do not sell the securities in the event of a market downturn. You only buy and sell a portion of your securities to reallocate and rebalance the portfolio. 

Active portfolio management also takes into consideration your risk profile, your age, your retirement or savings goals and amount to invest. A portfolio is selected but, rather than buy and hold the securities, based upon the parameters set, securities are bought and sold actively. In the event there is a market downturn, the portfolio can be placed one hundred percent in cash for safety. We use a different custodian to offer these services. Both styles have their merits. Both styles have their advocates and their adversaries. There are years where passive management outperforms active management. There are year where active management outperforms passive management. You have the final decision as to how you want to invest your money. Once you have chosen your path, you need to stick with it for the long term to achieve success.

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