The team of professionals at Cross Financial Services follows a thoughtful and disciplined investment process with the sole objective of achieving a client’s individual goals. Our investment process includes four important steps: Determine Risk Level, Select Investments, Create a Portfolio, Monitor and Rebalance.
Determine Risk Level
The first and most important step is to quantify a client’s tolerance for risk. The path to long-term financial success begins here. Our Risk Number Methodology helps our clients avoid unnecessary risks that may derail a financial plan and cause investors to make uncalculated or emotional decisions.
Next, we apply a rigorous due-diligence process to a wide variety of investments in order to distinguish a select few candidates. Because of our independence, we are free to use our expertise to thoroughly analyze an array of available investments from many different companies to find value. We ignore the “hot dot” and trendy advice from overconfident pundits.
Most of our investments are low-cost and broad-based. Robust academic evidence supports that investments with low fees have an enormous advantage over their more expensive peers. As a result, we favor low-fee investments in most circumstances.
Create a Portfolio
Once we have determined the risk level and investments appropriate for our client, we identify the best mix of the many potential combinations of the investments. We seek to broadly diversify our portfolios by grouping unrelated investments together, which can help maximize long-term return for a given level of risk. This process yields a “whole greater than the sum of its parts.”
Monitor and Rebalance
Our work continues after the portfolio is created. First, we regularly monitor investments and rebalance the portfolio to ensure it remains aligned with its objectives. Next, we take advantage of market volatility to harvest losses in taxable accounts, thereby reducing our clients' overall tax liability.
Our process is designed to be clear and transparent. Client assets are maintained at a third party custodian, such as TD Ameritrade or Charles Schwab. Our purpose is to manage your money, not to touch it. We also provide performance reports at least every quarter so our clients understand if their portfolio has made money net of all fees during the quarter, year, trailing three years, and since inception.
The time-tested and structured process helps many of our clients better understand the complexity of financial planning. By working together with our team through this process, they are able to make educated decisions and feel more confident in their financial future. To get started with your own financial planning process, we invite you to contact us today.