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INVESTMENT PHILOSOPHY

OUR BELIEF

An investment program should be a reflection of the unique characteristics of each client or client family, their financial circumstances, their short/long term goals, investment experience and tolerance for market value fluctuation. While some investment programs primarily seek growth, others focus on capital preservation. West Paces Advisors measures risk not simply in terms of price fluctuation (volatility) but primarily in terms of permanent loss of capital since this inhibits the accomplishment of short/long term goals for all clients.

West Paces Advisors builds investment programs using three complementary risk categories: Market Risk, Defensive Risk and Liquidity.

The Market Risk category relates to longer-term financial goals and seeks out the higher expected returns associated with investment in domestic and international equities. This utilization of investor capital represents fractional ownership in businesses and the resulting residual claim on the value of those businesses. That value should grow alongside general economic and company specific profit growth. Informed by ongoing industry research, West Paces Advisors seeks to access market, size and value risk premium via several different strategies, including passive, engineered and active management with an eye to balancing each individual strategy cost with total investment program costs.

The Defensive Risk category also focuses primarily on longer-term growth, but seeks to dampen the historical fluctuation of equities by introducing asset class segments that are correlated to changing economic fundamentals in different ways. This category includes asset classes that may provide clients greater levels of income and/or inflation protection than the Market Risk category.

The goal for the Liquidity category of each investment program is to generate income and protect principal needed to satisfy ongoing expenses and near term goals. West Paces Advisors seeks to accomplish these goals by purchasing short to intermediate term, high quality bonds/bond funds and money market funds. Since protecting principal greatly impacts a client’s ability to successfully fund near term goals, the Liquidity category is managed with an emphasis on maturity length and credit quality. Inflation protected bonds will also play a role in protecting future purchasing power.