Portfolio Management

BWA serves as Chief Investment Officer, providing ongoing investment diligence of managers and strategies; asset allocation and manager recommendations; and performance reporting oversight.

 

Example

Management of a Portion, and Eventually All, of a Family’s Liquid Portfolio

Upon recommendation of her family’s accountant and attorney, BWA was selected to begin managing a portion of a client’s wealth. She left the rest of her portfolio under the management of her family’s long-time broker.

As we got to know her, the client voiced several frustrations. She was keenly interested in investing in accordance with her values, but had previously been discouraged from pursuing this goal. She also wanted to see specific performance data that other providers had not furnished.

We listened to our client’s wishes, and were able to accommodate them easily. We already endorse, and practice, sustainable investing. The performance reporting we provide (compiled by an independent, third-party reporting firm, and audited by BWA) includes as standard data most of the specific report the client wished to see. We added a custom report that calculates the rest.

After several years of working together, the client asked BWA to manage her family’s entire liquid portfolio, and the additional assets were transferred to our care.

Single-Engagement Projects

BWA can be hired to analyze specific aspects of a portfolio or a client’s financial life.

 

Example

Analysis of a Non-Profit’s Endowment

A BWA team member provided pro bono analysis upon her election as a Trustee. This endowment offers an example, in microcosm, of the issues we typically see.

The Trustees sensed that the endowment, under the management of a large institutional advisor, was underperforming.

BWA’s analysis surfaced issues including excessive complexity; high fees; hidden risks; underwhelming performance; opaque communications; and indifference to the nonprofit’s ethical mission.

Issue Before After BWA's Recommended Changes
Complexity 25 money managers for a $6 million portfolio 4 broad-based public mutual funds: Three equity and one fixed income
Fees 112 bp + variable incentive fees 62 bp
Risks High leverage and credit risks in bond allocation. Overall risks undeterminable because of lack of disclosure Leverage risk eliminated. Credit risk reduced. Portfolio fully transparent
Performance Below benchmarks in every period examined. Some performance numbers missing or inconsistent Significantly better track record, especially in down markets. All performance data verifiable from public sources.
Communications Limited to what the outsourced CIO firm chose to disclose Public mutual funds, legally required to disclose full portfolio, fees, management, and other information
Portfolio Ethics Socially indifferent Socially conscious

Wealth Education

BWA works with families to design and present wealth education programs customized to each family’s situation.

 

Example

Ten-session Custom Education Program

A ten-session custom education program was designed for a mother and daughter, both only children, who were the sole heirs to a private agribusiness conglomerate amassed by their [grand]father.

The family empire including both operating businesses and portfolio investments. The founder/patriarch shared little information, leaving his prospective heirs apprehensive about their ability to manage their future responsibilities.

BWA created ten three-hour classes, covering the basics of accounting and financial statement analysis for operating businesses; and asset allocation, manager selection, and performance evaluation for portfolio investments. Case studies were drawn from the family’s own portfolio.

This education gave the mother and daughter the vocabulary and tools—and the confidence– to begin participating actively in the management of the assets they would ultimately inherit.

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