• Broad Diversification to reduce risk and maximize exposure to investment returns

• Low Fees because the less you pay in fees, the more money you make

• Patience is needed when investing because markets only have one true direction - up - but sometimes they go down before they get there

A deeper look into our investment philosophy...

Our investment philosophy is to take a passive approach to long-term investing. Passive investing can be thought of as a relaxed approach to investing – we don’t get caught up in the unpredictable day-to-day movements of the markets, we don’t chase the hot stock, and we don’t let our emotions get the best of us. We don’t know if the market will be up or down tomorrow and we stay away from those who say they will know where it will be tomorrow. We stay grounded and we stay focused on the big picture at all times, knowing that our diligent efforts will reward our clients’ portfolios over the long-term.

History and literature supports that NO ONE can consistently time the market or consistently pick stocks that will outperform the market. We know this first and foremost, so we don’t fight the market, instead we hop on for the ride (and it is a roller coaster ride). We utilize low cost efficiently managed funds to assemble a diversified portfolio across a broad range of global assets. This approach is known as asset allocation and it is fundamentally the most critical decision an investor can ever make.

There actually is a right way and a wrong way to invest your money and to plan for your future. Picking stocks, using actively managed mutual funds, chasing past performance, or following what some guy on CNBC recommends is the wrong way to invest. Pensinger Financial prides itself on teaching our clients the right way to invest. The right way is less complex, less emotional, more efficient, not as expensive, and will provide better returns over the long-term. The bottom line is the right way to invest becomes the only way to invest.

We are pleased to be among a limited group of advisors offering Dimensional Fund Advisors (DFA) mutual funds. DFA was founded in 1981 and is one of the largest asset management companies in the US. It has a clear investment philosophy, with which we are aligned, and its strategies are rooted in the research of leading financial economists. DFA manages broadly diversified funds that employ highly efficient trading techniques. It provides consistent risk management, lower costs, reduced turnover, and improved tax-efficiency. To learn more about DFA, click here to leave our website and visit theirs; and click here to view a short brochure about DFA's approach to better investing and its impact on you.

ASSET ALLOCATION EXPLAINED

Asset allocation is the main driver behind your portfolio’s return. Asset allocation is an investment strategy that aims to balance risk and reward by building your portfolio across stocks, bonds, real estate, and cash according to your investment goals, risk tolerance, and investment time horizon. Many studies have shown that a great majority of a portfolio’s variability in returns is due to asset allocation. Very little is due to market timing or stock selection. Our goal is to provide our clients with the means to make an accurate and comfortable decision based upon their risk tolerance.

We measure expected returns as they relate to expected risk – you simply cannot have more returns without taking more risk. After the asset allocation has been chosen, our clients’ portfolios benefit from the discipline of periodic rebalancing. When we rebalance our clients’ portfolios we sell some assets when they are overbought and we buy some assets when they are oversold, this puts their portfolio allocations back within their targeted range, and, believe it or not, rebalancing actually forces us to buy low and to sell high over time. In addition, our clients benefit from asset location, where we park less tax efficient investments in more tax favorable accounts.