Storms & Rowdon Financial Services
Tending & Growing (v.) taking care of and increasing, thriving
We review, rebalance, trim, weed, and patiently wait for you farm to produce your desired thriving crops.
A farmer does not just plant a crop and then do nothing until harvest time. Until the crop is ready for harvest, he will oversee the crops, make ongoing adjustments depending on the weather, and treat the soil for pests and other potential hazards. Weeding and other activities may be required as well.
Investing is similar. Once a portfolio is created, ongoing review is required. Rebalancing may be prudent, new positions may be added to sectors not invested in, or trimming a position may be needed should a position get to concentrated. Balance and patience is required for both until the harvest of crops, the financial goal, is reached and/or money is needed.
We believe that sector allocation is an important ingredient for ongoing portfolio consistency. Because of our belief, we attempt to limit any one stock position to having any more than 5% and any one sector having more than 15%. We believe that this contributes to avoiding possible financial catastrophes caused by overexposure in one position. We also believe that our clients should be broadly diversified and be invested into each of the ten economic sectors. Taking a balanced approach can help mitigate issues that occur due to various market scenarios. Finally, a percentage of cash in a client’s portfolio is prudent for protection as well as having money available when the markets give us a great buying opportunity.
