Pavlic Investment Advisors follow a six-step process with every client.
Step 1: Personal Financial Analysis
We meet with you to understand your cohesive financial picture from which we develop individualized investment goals and an investment plan. No one client is the same and therefore no investment plan is the same.
Step 2: Develop a Customized Portfolio
We create a customized portfolio designed to achieve the goals identified in Step 1. This includes investments in three types of asset classes: stocks, bonds, and REITs, depending upon your personal financial profile, risk tolerance, and financial goals.
Step 3: Research and Selection
We research and select individual stocks, bonds, and REITs for your portfolio. We invest in both growth and value companies, predominantly mid-and large cap companies that are high quality businesses, with stock prices below their fundamental value. We follow a disciplined, theoretically sound stock selection process and our Number 1 rule is to not invest in anything we don’t understand and that doesn’t generate strong, consistent cash flow. Our bond portfolios comprise eight to ten investment-grade bonds that mature at intervals over the future 10-year period. Our focus in bonds is maximizing coupon interest while holding bonds until they are called or matured. Our REIT portfolio offers greater returns than bonds over the long term and a dividend yield greater than stocks, but also will come with greater volatility than that of our bond portfolio.
Step 4: Continuously Monitor Portfolio
We continually monitor our portfolio holdings and make changes when there is a break in our original investment thesis. We protect against risk through quality screens, a focused sell discipline, and a common-sense asset allocation model for our clients.
Step 5: Buy and Sell
As we monitor your portfolio, we buy and sell as we deem appropriate to meet your investment goals while also being cognizant of portfolio turnover and resulting tax implications. We buy stocks that do well in 14 characteristics that we assign into three categories: value, earnings expectations, and growth. We assign each stock a score of 1-10 in these areas and then perform a trend analysis, preferring to buy stocks that have shown evidence that a stock is establishing the reversal of a downtrend or is in a defined uptrend before buying. Concurrently, we consider selling stock when it ranks poorly in our scoring system, the price falls 15% from purchase, or its price trend is reversing. This strategy improves our ability to harvest winners in a timely fashion and to limit the downside caused by poor performers.
Step 6: Communicate Regularly
You will always know the status of your portfolio. We send statements quarterly and often update clients midway through the quarter during times of heightened market volatility. We regularly communicate with clients either over the phone, through video conference, or through face-to-face meetings depending on our client’s preferences.
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