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Investment Philosophy
At Greenspring Wealth Management, our approach to managing money focuses on providing our clients with a successful investment experience. This means helping them minimize or even eliminate the stress they feel about the investment process, and allowing them to stay focused on the long-term rather than worrying about their money.
We believe that capital markets work effectively over time and that our role in the investment process is to prudently deploy our clients' capital in a way that enables them to achieve market rates of return. By doing so, we are able to help our clients benefit fully from the wealth creation that comes from long-term market appreciation.
Our approach is in contrast to most strategies that try to "beat" or "outperform" the market. There are significant amounts of research showing this "active" style of investing to be extremely difficult to do over time.
For our client portfolios, we typically utilize Exchange-Traded Funds (ETFs), alternative investments, index funds and other passively managed investment strategies available through our partnership with Dimensional Fund Advisors (DFA). DFA strategies are only available to institutions and select
non-commission-based, "fee-only" investment advisors like Greenspring Wealth Management. DFA does not make their strategies available through brokers or directly to retail investors. To learn more about DFA's unique approach, please read "The Science of Investing". We believe our access to DFA provides a unique competitive advantage for our firm and our clients.
The cornerstone of our philosophy is helping our clients focus on the elements they can control rather than on those they cannot. We believe there are four aspects of the investment process that are within our control:
- Discipline - We develop an Investment Policy Statement (IPS) for each client of our firm. The IPS
sets forth
asset allocation guidelines, rebalancing procedures, security selection, rate of return targets, risk tolerance and client goals. All investment decisions are made according to guidelines set forth in the IPS rather than by gut feelings or emotion.
- Diversification - We believe that a globally diversified portfolio is the only effective way to deliver capital market rates of return. Each client portfolio is diversified across a minimum of twelve (12) asset classes ranging from domestic and international stocks, bonds, real estate, commodities and cash.
- Costs - Many people are unaware of how much impact expenses can have on the growth of their long-term assets. In general, lower expenses equate to higher returns. We pay careful attention to control all the costs associated with investing. To learn more about the true cost of financial advice, please click here.
- Taxes - Taxes can also play a significant role in limiting your returns. You can't avoid paying taxes, but you may keep more of what you earn if you plan carefully. We seek to implement long-term, tax-efficient investing strategies for our clients.
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