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Investment Management

Cathy Pareto and Associates provides ongoing investment management services in conjunction with financial planning for:

 

 

Asset Allocation

Asset allocation explains more than 90% of the volatility (or variance) of returns of an overall portfolio. Depending on your individual goals, risk tolerance and other factors, your portfolio may consist of equities, bonds, cash, and alternative asset classes.

Read Understanding the Benefits of Asset Allocation

 

Investment Selection

We do not believe that anyone can consistently outsmart the market. This belief is backed by research that suggests that market timing only accounts for 2% of a portfolio’s returns.

Because of this, our portfolios are designed for long term investors. This however, does not imply that your portfolio will remain static. Economic conditions and other special circumstances may warrant a modification of your portfolio and more nimble approaches to your asset allocation. We endorse a “buy and monitor” approach. In these events your Advisor will contact you to discuss a new strategy or investment opportunity.

We employ the use of no-load funds and ETF’s (meaning, no sales commissions to the advisor). Our search criteria factors things like fund costs, tax sensitivity (where appropriate), number of stock or bond holdings, fund construction and fundamental analysis, industry exposure, volatility, and more.

Read Our Investment Philosophy

Read Are You Investing or Speculating? Your Answer May Be Detrimental to Your Future Wealth

 

Reports and Other Services

Aside from the ongoing review and monitoring of your investments, Cathy Pareto and Associates provides you with:

  • Quarterly Market Updates
  • Quarterly Performance Reports
  • Quarterly Account Holdings Reports
  • Annual Distribution Planning
  • Ongoing Useful Reminders to Help You Stay on Track
  • End of Year Tax Loss Harvesting
  • Account Rebalancing
  • Ongoing Account Reviews

 

Custody of Client Assets

We never take custody of client assets, nor do we have full power of attorney over our client’s accounts, instead we have a limited power of attorney to trade and make client approved changes and requests. We serve as a fiduciary advisor on every client account, meaning we will always do what is in the best interest of the client.

Our client assets are held at Charles Schwab & Co., Inc. who serves as the primary custodian but we also help manage the assets of clients who have 401(k) or 403(b) accounts at other custodians.

Using Charles Schwab & Co., Inc as primary custodian, Cathy Pareto and Associates has access to a wide range of products and support to help investors reach their financial goals, including:

  • Full range of investment strategies and trading services
  • Wealth management services
  • Technology and service support
  • Safeguards designed to protect assets
  • Strict ethical business practices

We do not sell products, nor do we receive any type of compensation from any firm, including Charles Schwab & Co., Inc. This relationship simply allows us to track your investment accounts on a daily basis and provides you with increased privacy and security.

Our primary goal as your investment advisor is to provide objective investment advice and select investments that will maximize your expected return with a measured amount of risk. In making the investment selections in your portfolio we take into consideration your risk tolerance, tax sensitivity, investment horizon, investment costs, cash withdrawals from your portfolio, and other individual factors.

We strive to achieve principal preservation, capital enhancement and inflation protection for our client portfolios.

 

Fees

After our clients receive their in depth financial plan, most choose Cathy Pareto and Associates to manage their assets. For this reason we credit 50% of their financial planning fee towards their asset management fee.

Our investment management fee includes the updating of your financial plan and ongoing in depth advice as needed. The scope of work and fee for an Advisory Service Agreement is provided to the client in writing prior to the start of the relationship.

The annual investment management fee is based on a percentage of the investable assets according to the following schedule:

 

Portfolio Size Quarterly Fee Annual Equivalent
First $1,000,000

0.25%

1.00%

Next $1,000,000

0.1875%

0.75%

Next $3,000,000

0.125%

0.50%

Balance Over $5,000,000

0.1%

0.40%

 

Account Size Minimum

Cathy Pareto and Associates generally requires a minimum of $500,000 to open and maintain an individually managed account. This account minimum may be waived at the discretion of the Firm. Where the Firm waives this account minimum, the annual fee will be set at 1.50% subject to a $5,000 minimum annual fee.

Cathy Pareto and Associates allows the accounts for members of the same household to be combined for fee paying purposes. We combine the account valuations to assist you in meeting fee breakpoints and therefore lowering the overall fee level. The firm extends this option to all accounts residing in the same household.

 

Contact us today to learn more about our client approach

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