Investment Management

"Someone is sitting in the shade today because someone planted a tree a long time ago." - Warren Buffet

Investment Program

We combine the power of experience and technology to provide you a balanced approach to portfolio management. We implement a diversified and transparent strategy aligned with your financial needs and goals. Our strategy is supported by our internal and proprietary economic and company level research processes. This strategy is supported with partnering with Value Line and Morningstar to help us validate our positioning.

We utilize stocks, stock options, bonds, and cash as our investment vehicles. While we may use Exchange Traded Funds to ensure proper diversification depending on your portfolio size, we invest in actual retail bonds for proper diversification of asset classes (versus investing in “bond funds” which are traded as equities). We calibrate and tailor the positions to each individual based on an Investment Policy Statement (IPS) and your financial plan.

We provide discretionary services, meaning we retain the authority to buy, sell, or hold your portfolio positions. We have no account minimums and can help you open your first investment account. We offer qualified (e.g. IRA, Roth IRA, 401k)and non-qualified accounts (brokerage).

Strategy Overview

Our core investment strategy centers on a well‐diversified, buy‐and‐hold, portfolio. This strategy centers on fundamental portfolio management principals targeted to safeguard assets while seeking market-indexed returns. We take the general position that long‐term investors with diversified portfolios have a better chance of higher returns because it is difficult to accurately predict the daily movement of the stock and bond markets. We generally seeks investment strategies that do not involve significant risk or unusual risk beyond that of the general domestic and international equity and bond markets.

Your investment portfolio is tailored to your investment time horizon and risk tolerances. We measure your time horizon and risk tolerances using regular surveying methods such as questionnaires and meetings to promote financial education and personal stewardship toward responsible budgeting and savings. For example, a client closer to retirement and low risk tolerance will have more fixed income investments with low duration and convexity (lower market risk volatility) compared to a younger client with a high risk tolerance. The overall blend of equity and fixed income also impacts our ability to control equity volatility measures such as weighted beta correlation to benchmarked indexes. We may use collateralized derivate transactions (i.e. “covered” calls and puts) based on the prior approved IPS.

Portfolio holdings or recommendations are generally judged by (managers’ or investments’) experience, expenses, track record and performance of like‐kind investments. We actively monitor each portfolio. Clients should expect to remain fully invested within the ranges of their selected asset allocations as outlined in the IPS.

Investments in individual stocks can be risky. Some risks can be controlled, and some risks can be guarded against, but no investment strategy can carry guarantees from loss. Certain market risks cannot be controlled, such as market or economic conditions. We design portfolio strategies for the long‐term, unless otherwise specifically requested in writing. Therefore, we do not attempt to “time the market.”

Custodian and Brokerage

We have retained Shareholder Services Group (SSG) as our centralized asset custodian and brokerage. During our due diligence process, we considered industry practices surrounding trading fees, account minimum balances, account type offerings (qualified versus non-qualified), security trading ability (equities, retail bonds, and derivatives), reporting capabilities (internally to SMC and externally to the client), and trading platform including desktop and mobile capabilities. We complete ongoing due diligence to support the our custodian and brokerage selection.

Monitoring and Reporting

We affirm the client IPS on an annual basis or on an ad hoc basis. The affirmations are based on client interviews and questionnaires. We may trigger specific, or ad hoc review of client accounts on a periodic basis. We complete the “horizontal review” of portfolios contingent on certain risk events which may warrant such a review. For example, if a specific industry, such as Oil and Gas, experiences a drastic change in economic condition or a material event impacting the price of crude oil, we will complete a Horizontal Review to measure the potential impacts. We incorporate our review into our regular client interactions through meetings and written mediums.

Engagements, Fees, and Billing

The investment management advisory service is outlined in an Engagement Letter (EL). The terms of the EL remain perpetual in effect until written notification is provided. Clients are welcome to terminate services at any time with no penalty. Your portfolio will never be assigned outside our firm without your prior written consent.

We utilize the Seed Money Consulting wrap fee program, which is our general billing method. Our wrap fee is a unified fee which supports our operating costs, reasonable third‐party fees, and capital requirements. The fee is reflective of the client engagement’s complexity. Advisory fees are agreed upon at the time of engagement and range between 150 and 60 basis points, annually, based on a waterfall of your AUM as outlined in the IPS. This results in a “blended” rate calculation.

Our program utilizes “constructed custody” of your accounts meaning we establish the ability to charge our fees directly to your investment account. The billing is reported by us as well as on your brokerage statements. Our fees range from 150 basis points to 60 basis points and charged in a marginal rate fashion based on your Assets Under Management (AUM). We bill monthly, in arrears, and always pro-rate based on the market value of your portfolio. For example, for a $100,000 portfolio, we charge $1,500/year ($125/month). This is a simplified example given your market value of your portfolio will change throughout the year.