Our fee structure is based on the assets that we manage for each customer, ranging from 1.6% to 2% per annum. All returns on the performance page are net of the highest possible fee, so depending on your fee, your net return may have been greater.
This will depend on your Strategy and the market environment. Periods of volatility may produce more trades as the systems attempt to get better clarity as to a potential change in an intermediate trend. Trades will be based on mathematics and the analysis of indicators, not any specific time frame.
Generally we trade Index-based ETFs. The ETFs are designed the replicate, before fund fees, the daily movements of common Equity and Bond based indices.
Fidelity Clearing and Custody Solutions is a service provider to Porter Investments, Inc. Securities in accounts carried by National Financial Services LLC (NFS), a Fidelity Investments Company, are protected in accordance with the Securities Investor Protection Corporation (SIPC) up to $500,000. The $500,000 total amount of SIPC protection is inclusive of up to $250,000 protection on claims for cash, subject to periodic adjustments for inflation in accordance with terms of the SIPC statute and approval by SIPC’s board of directors. NFS also has arranged for coverage above these limits. Neither coverage protects against a decline in the market value of securities, nor does either coverage extend to certain securities that are considered ineligible for coverage. For more details on SIPC, or to request a SIPC brochure, visit www.sipc.org or call 202.371.8300.
"excess of sipc" coverage
In addition to SIPC protection, NFS provides for brokerage accounts additional “excess of SIPC” coverage through Lloyd’s of London, together with other insurers.¹
The excess of SIPC coverage will be used only when SIPC coverage is exhausted. Like SIPC protection, excess of SIPC protection does not cover investment losses in customer accounts due to market fluctuation. It also does not cover other claims for losses incurred while broker-dealers remain in business. Total aggregate excess of SIPC coverage available through NFS’s excess of SIPC policy is $1 billion. Within NFS’s excess of SIPC coverage, there is no per-account dollar limit on coverage of securities, but there is a per-account limit of $1.9 million on coverage of cash. This is the maximum excess of SIPC protection currently available in the brokerage industry.
¹ Fidelity’s “excess of SIPC” insurance is provided by Lloyd’s of London together with Axis Specialty Europe Ltd., Markel International Insurance Company, XL Specialty Insurance Company, and Munich Reinsurance Co.
Fidelity Clearing and Custody Solutions provides a comprehensive clearing and custody platform, brokerage services, trading capabilities, and practice management and consulting to registered investment advisors (RIAs), including strategic acquirers and professional asset managers, as well as retirement recordkeepers, broker-dealer firms, banks, and insurance companies through National Financial Services LLC (NFS) or Fidelity Brokerage Services LLC, Members NYSE, SIPC. In addition to providing services to third-party institutions, the NFS brokerage platform supports all the clearing and custody businesses at Fidelity, including Fidelity’s retail and capital markets businesses, bringing NFS assets under administration to over $3 trillion.
All securities in your account will be widely traded and priced daily. Almost all Strategies employ index-based funds that are designed to track the performance of the major market indices such as the S&P 500, the Nasdaq, and the Russell 2000. Accounts can be liquidated at any time.
Absolutely. An account will utilize only one Strategy. Many clients start with one Strategy, and then add funds to a more aggressive or more conservative Strategy. This is a great way to create a portfolio that has maximum model diversity.
We seek to fully participate in the upward trends of the stock and bond markets, while preserving or increasing your multi-year gains when those inevitable and severe markets corrections occur. In seeking continual growth of your assets, we invest differently in up and down markets.
A great interview (old but still relevant) explaining our approach can be viewed here.
There are many good investment approaches depending on your objectives. We believe if your objective is steady long term growth, then anything you can do differently to either make or at least not lose money during major market corrections is better. It may be true that an account using a "buy and hold" approach, if left alone, would probably work its way back up to its prior level. But from purely a mathematical standpoint, wouldn't it be better if your account did not have to recover much of it's lost value first before it marched to new highs? Please see the Factsheet graphs on the Performance Page.
Our approach may have some degree of difficulty performing as well as it’s long term average during periods when market prices change direction very frequently in a trendless, sideways market. This is less frequent and these periods tend to mainly be short-lived.
There are two different meanings of the term “time the market”. One meaning may entail that someone tries to predict the frequent up and down “wiggles” in stock prices. This requires many trades and we would agree with you, that cannot be done successfully. The other meaning may concentrate on reacting to the changes in the longer, more intermediate term trends of the markets. Those types of systems, that react to more meaningful changes in a significant trend, are successfully used today in thousands of applications. You already experience the benefit of these systems every time you fly in a plane or drive a car.
During periods of significant drops in prices, many Strategies use Inverse ETFs. Inverse ETFs are designed replicate, before internal fees, the opposite daily movements of a particular Index. They are generally held for short periods of time as the bulk of large moves down can be concentrated in a small number of trading days.
The Strategies will not react to all minor price moves in the markets but are designed to react as quickly as appropriate to the meaningful changes in the market data. How a Strategy interprets the changes to the data, and accordingly how much the market moves in price leading up to a trade, is based primarily on the frequency of the selected models in that Strategy. More importantly, a weekly move of even 4-5 percent has to be viewed within the context of the more intermediate trend. The overriding goal is to avoid the severe, prolonged corrections that can cause major harm, while allowing for the normal "wiggles" in prices that occur during an extended rise. Each Strategy is designed to deliver a different return and drawdown profile. See Performance Summary for a comparison of the different risk profiles.
Some of our clients have a portion some of their investment money with another RIA firm. If you already have an existing relationship with another financial advisor that you are happy with, but you like our past results, you may consider using our firm for part of your portfolio. Diversification of money managers is a good strategy if both are performing well.
Many firms do a good job of providing a broad overall structure and plan for your financial portfolio. Investors look to us to complement their existing relationships by providing a defined specialty and focused approach, for part or all of their assets. Sometimes they desire more frequent account surveillance and a more direct, controllable relationship to the person “working the levers”.
As a fee-based Registered Investment Advisor, we have always served our clients as fiduciaries, which requires a higher legal standard of business conduct than what has historically been required of a commission-based stockbroker. We welcome the recent legislation requiring some commission-based advisors to now adhere to this higher standard, as we have always felt that this standard more closely aligns a clients’ interest with the investment firm. If you have a question about your advisors’ role, ask them to represent in writing to you whether he or she is acting as a “fiduciary”.
Our firm has Investment Representatives, a separate trading team, separate research personnel, as well as customer support personnel.
Our published minimum is $200,000; but we will consider investments as low as $50,000 under certain conditions. Our average initial client relationship is between $500,000 and $700,000.
It is important to distinguish between a full scale financial plan and a retirement plan. We do not create extensive financial plans covering budgeting, insurance, and Estate planning. We will provide a free retirement plan for you, that entails projections on the growth, withdrawal capability, and sustainability of your retirement assets, as well analyzing your outside sources of income such as social security.
Many of our clients have worked with Certified Financial Planners (CFP) for specific non investment related advice. We would be please to direct you towards another financial professional to address a specific need.