As a Registered Investment Advisory firm, Woodley Farra Manion is also a fiduciary. This means that all financial professionals at our firm have pledged always to act in the best interest of our clients. It is important that our clients feel secure, knowing we manage their assets with their benefit at the forefront of our minds. Our clients’ success is our success. We don’t sell products, nor do we recommend investments that provide commissions or other incentives back to the firm. Working with a fiduciary can provide a greater sense of confidence and clarity that our goals are closely aligned with those of our clients.
Our main objective in the retirement portfolio review process is helping our current and prospective clients identify their long-term investment goals and determining how we can best assist in attaining them. Special consideration is given to the client’s risk tolerance, investment time horizon, and retirement vision. We believe that in order for a client to properly execute any investment plan, they first must fully understand what financial risk feels like in both good and bad markets as we navigate their long-term plan.
Our firm utilizes a basic questionnaire, which provides key information to be input into our financial planning software. The questionnaire takes about 30 minutes to complete and will be provided ahead of the introductory meeting. The follow up analysis and discussion of the results takes approximately 30 minutes, so the entire process can easily be completed within an hour. The only items you need to bring to the initial meeting are your completed questionnaire and any ancillary information you wish to discuss.
The CFA Program sets the standard as the most highly respected designation in the investment management profession. The CFA charter is a globally recognized credential award given by the CFA Institute. The Institute represents the industry gold-standard for effective and ethical investment management practices, with a strong focus on maintaining the highest level of professional standards.
The CFA Program is a three-part exam that tests the fundamentals of investment tools, valuing assets, portfolio management, and wealth planning. The CFA exam process is known to be extremely difficult, with overall pass rates generally below 50%. Candidates are routinely required to spend over 300 hours preparing for each exam.
CFA charterholders earn the right to use the CFA designation after successfully passing all three exams, completing 4,000 hours of professional work experience, and completing an application and acceptance process by CFA Institute.
We invest to provide a competitive total return with downside risk protection. Research has shown that one of the best ways to achieve this goal is to invest in a diversified portfolio of well-established, large, value-oriented stocks. Whereas most advisors outsource investment management by selecting mutual funds, ETFs, and other investment vehicles (adding another layer of fees), we purchase individual stocks based on our own in-house independent research. Our multi-disciplinary research process for stock selection involves fundamental, quantitative, technical, and economic criteria. More on our process can be found here.
Clients have the final say over what they own. WFM serves as a discretionary manager, assuming responsibility for day-to-day investment decisions so clients don’t have to. Clients work with their advisors to determine the proper asset allocation, exclude securities that do not align with their personal views (e.g., no tobacco stocks), and add securities should they wish.
We generally require a minimum initial relationship size of $250,000, though this minimum may be waived at WFM’s discretion.
Woodley Farra Manion’s advisors take the responsibility of client education seriously. We have noted over the years that better-informed clients have longer investment horizons, which serves their best interest during periods of market volatility. Understanding the market passes through different stages of advances and corrections helps clients to not let their emotions rise or fall too much and keep their focus on the long run benefits of remaining invested in the market.
Every client relationship is unique. Many clients enjoy speaking with their advisor on a regular basis, such as each quarter, to discuss their investment results and current market conditions. Other clients prefer using email to ask specific questions that are answered in writing for future reference. We discuss what form of communication is preferred with each client after they have retained the firm to manage their portfolio. How often they speak with their advisor is dependent upon each client’s unique needs.
The client-advisor relationship is interactive. Woodley Farra Manion’s monthly Dashboard email often serves as a prompt for a client to email or call with questions or to discuss the content of the Dashboard. The firm’s quarterly report is designed to inform clients of their portfolio’s performance, current composition of investments, and market conditions that may affect their results in the coming months or quarters. Both communications are designed to educate and prompt client-advisor discussions.
Our client portal is a convenient way to review your portfolio and securely upload and download documents. The client portal provides updated account values, transactions, performance and various other analytical reports. It is also an effective way to review your retirement readiness with your portfolio manager remotely if you are not able to have an in-person meeting.
Woodley Farra Manion Portfolio Management is a research-based investment manager. Our seven-member portfolio management team includes six CFA charterholders (CFAs). They research companies to generate a portfolio of 25 to 30 stocks. These companies represent as many industries as attractive valuations can be found. Thus, a focused and diversified portfolio is constructed without the over diversification many managers pursue which can end up providing mediocre to inferior long-term performance. To the contrary, WFM has provided nearly twenty-seven years of competitive returns while protecting against much of the downside risk inherent in a stock portfolio.
WFM serves the client that is looking to preserve their wealth and have it grow at a reasonably good rate. We are not a good fit for those investors trying to get rich quick. Our portfolio emphasizes companies with strong free cash flows from which they can pay, increase dividends, and buy back stock. The portion of a company’s free cash flow used in this manner is strongly correlated with stocks that go up in value over the long-term. We also require that our companies possess rock solid balance sheets and have a strong leadership team that has or is expected to show growth of sales, earnings, cash flow and dividends.
The main difference between a traditional IRA and a Roth IRA is when they are taxed. A traditional IRA gives you tax deductions when you make contributions, but requires you to pay taxes on your withdrawals. A Roth IRA does not give you tax deductions when you make contributions, but your withdrawals are tax-free. Otherwise, both accounts provide tax-deferred growth and are subject to contribution and income limits.
Which type of IRA is best for you depends on your current income tax rates and what you expect them to be when you withdraw money from your IRA in the future. A higher current tax rate favors a traditional IRA due to tax deductions on contributions, whereas a higher future tax rate favors a Roth IRA due to tax-free withdrawals.
Please take a look at this article if you’re interested in a more in-depth discussion of the topic.
The Core Portfolio is geared for a higher total return—dividends plus capital appreciation—while the Dividend Portfolio is geared for a more modest total return, but with higher current income from dividends than the Core Portfolio will provide.
The Core Portfolio is suited to an investor who is focused on growing the value of their portfolio and doesn’t need to take income from the portfolio to satisfy current spending needs. The Dividend Portfolio is suited to an investor who is more interested in generating current income while maintaining the value of their portfolio.
Ultimately both the Core Portfolio and Dividend Portfolio are appropriate for investors seeking reduced volatility in their equity investments. Both invest in large, stable companies that can grow their dividends over time. The choice between the two will come down to your financial goals and personal preferences. We can help you determine which portfolio will be the best fit for you.