To help clarify how we are different from other advisors, our team has created this document: Our Philosophies and Commitments. What we share here goes beyond the nuts and bolts of what we do. We dig deeper and examine our core. We identify elements that are useful both for us in clarifying our thinking – and for you in learning what to expect from our team.
Our five Philosophies
Our Philosophies represent the core beliefs that motivate our behaviour and our actions. These Philosophies are unwavering because they are a fundamental part of us. Essentially, these Philosophies define our worldview.
Valuable plans are always tested for resiliency. Planning is important because it helps improve decisions. But planning also involves assumptions about the future. For any plan to be valuable, it has to recognize this uncertainty and be tested for resiliency: the ability to change and adapt as the future unfolds. That’s the only way we can be comfortable with our plan.
There is opportunity in uncertainty. The stock market seems uncertain. But over the long term, stocks as a group have given higher returns than any other major asset class. Historically, with a diversified group of larger stocks, we see that the risks fall over the long term as down times are more than cancelled out. The key is: Short-term uncertainty creates opportunity for higher returns in the long term.
Preparation trumps prediction. People like to make predictions. But problems arise when we put too much faith in specific predictions. There are so many complex and unpredictable factors that it's almost impossible to predict the future accurately. On our team we instead believe in being prepared. The best way to protect yourself and generate reliable returns is to be prepared for surprises and errors in forecasts.
The past informs the future. It's important to study the long-term trends and avoid our natural temptation to focus on the short term. That’s because the short term is overly influenced by randomness, which can fool rather than inform us. By focusing on the long term, we get a clearer view of the real trends and tendencies.
Appreciation enhances engagement. One of the best things about being on the Stan Clark Financial Team is the satisfaction we get from helping people. When our clients express appreciation for the work we do, it makes us feel great! It encourages us to keep doing our best. We feel fortunate to have such a wonderful group of clients who share our philosophies. Our mutual appreciation and engagement work not only to create a great relationship, but to help us give you the best results.
Our six Commitments
Our Commitments are our promises to you – promises that we unfailingly fulfill. As with our Philosophies, we fulfill our Commitments because they're in our very nature; because we can't help it. They are built into our personal DNA. We expect these Commitments of ourselves – and we want you to expect them of us.
Apply discipline to improve decision-making. In our profession, we face many decisions, for example, what your asset mix should be or which stocks you should own. But we don't want to make these big decisions off the cuff. Instead, we come up with a plan, or a set of rules, and then we follow that plan with discipline. Research has shown us this approach can work well with financial decisions.
Earn trust through transparency. Trust is vital in our field. We believe trust needs to be earned, and we believe the best way to earn it is by being transparent in all areas. We have an open and clearly defined process for how we make decisions. We start with a personal financial plan and written investment policy statement. From these, you then know the basis for our big-picture decisions and the guidelines used to manage your portfolio. We also provide regular performance reporting, including a relevant benchmark to see how you are doing. We have clearly defined rules for choosing your investments. We're also upfront about our fees, so there are no surprises.
Build performance-enhancing technology. We’re experts in finance – and we also love technology! We've built from scratch many of the financial planning, investment selection and reporting tools we need to do our job well. We're committed to continue being leaders in this area; to keep building what we need to stay ahead.
Stay independent of industry pressures and influences. It is our objective to run our business and manage our portfolios independently to ensure our clients’ interests come first. We use independent sources for our data; we don't rely on any one firm's research; nor do we rely on third parties such as mutual funds and other investment managers.
Be consistent and reasonable in all interactions. Our disciplined approach, processes and technology enable us to be consistent in the work we do for our clients. For example, we are consistent, fair and, as noted above, transparent with the fees we charge our clients. Further, we use the same investment strategies and approach to financial planning for all our clients as we do for ourselves.
Counteract irrational instincts with education and perspective. From our extensive research in behavioral finance, we know that everyone has a natural tendency to behave irrationally with finances and investing. The best way to counteract these tendencies is through awareness – and awareness comes through education and taking the right perspective.
On our website, you can learn more about each of our Philosophies and Commitments, and how they influence what we do.
We hope our Philosophies and Commitments help clarify important areas where the Stan Clark Financial Team may differ from other advisors – and show how we differ in a meaningful way.