Capital Preservation

As clients approach retirement and time horizons shorten, we typically recommend transitioning from either Capital Appreciation or Income to Capital Preservation. This means that decreasing maximum drawdown (our preferred measurement of risk) even at the cost of upside potential becomes an increasing priority. As such, we slowly transition the portfolio by reducing the allocation to funds with large maximum drawdowns to alternative Funds, and potentially even hedge, based on Trend, the part of the portfolio invested in individual stocks. This approach allows the portfolio to weather market downturns without as much of the volatility associated with either the Capital Appreciation or Income objectives.