Bringing ideas to the table
Naturally, a central part of the role is being a source of ideas. That means bringing new investment strategies to the table, sharing research and commentary from respected investment companies, and raising new topics or issues that deserve our attention. Staying curious and continuing to open up our thinking is an important part of the job.
More than picking winners
But an Investment Committee is responsible for more than just picking investment winners. Several other factors have a big effect on investment success.
- Portfolio Construction. We need to consider whether the level of risk and potential reward of an investment strategy makes sense for a particular type of account and the amount of time that money is expected to be invested.
- Taxes. Some investments are a better fit for accounts that are taxed, and others for accounts that are not. We also weigh the taxes that selling at a profit can trigger whenever we consider changing our standard portfolios.
- Timing. Economic conditions, the time of year, and prior portfolio changes can all influence when an action makes the most sense. Sound decisions often depend not only on what to do, but also on when to do it.
The leader of the Investment Committee needs to be the maestro who makes sure all of these factors work together in concert.
Leveraging The Power of a Group
The greatest strength of an Investment Committee is the collective wisdom and perspective of multiple professionals. Bringing different experiences and viewpoints to the same discussion can lead to more durable investment decisions.
So the leader’s job is to invite critical questions, encourage active discussion, consider a range of opinions and outlooks, and challenge assumptions.
The Chairman’s task then becomes turning the group’s whiteboard into actionable ideas.
Keeping Our Mission and Values at the Center
Leadership is also responsible for keeping our firm’s Mission and Values as a primary driver of every decision.
Simplify the Complex
Part of our mission is to Simplify the Complex. In practice, that means considering every reasonable investment while avoiding strategies that are unnecessarily exotic, opaque, overly complicated, or cumbersome to implement. Not every strong performer on paper is a good fit.
Simplicity also applies to how we build portfolios. If we can accomplish an objective with two accounts instead of four, there is value in choosing the simpler approach. Complexity should have a purpose.
Create Success
One of our fundamental Values is to Create Success. That means taking an appropriate amount of risk based on each client’s goals, needs, and temperament. As a result, leading an Investment Committee means making sure risk—not just performance—is part of every strategic conversation we have.
In closing
Client Success is the ultimate goal. Leading an Investment Committee with that goal always in focus requires diligent research, keen group awareness, and, frankly, a large dose of humility. I, and the leaders on this team, relish this role, guiding an Investment Committee at Argent Bridge that works very hard to create that success for every client.
