Efficient Market Advisors, LLC is the Investment Advisor to the Efficient Market Portfolios™ account. Efficient Market Portfolios accounts provide investors with an account that seeks to maximize investment performance given the investor’s time horizon and willingness to accept risk. The Efficient Market Portfolios account is offered exclusively through qualified financial advisors and Efficient Market Advisors. LLC.
Efficient Market Portfolios managed ETF accounts are offered through Efficient Market Advisors, LLC. Based upon your answers to our time and risk profile questionnaire, you will be assigned one of fifteen unique investment models. Each model was designed by Efficient Market Advisors and optimized using Modern Portfolio Theory and sophisticated asset allocation modeling software. Our proprietary tactical overlay is further applied to adjust models base on our current view of the marketplace.
Portfolios will be reviewed at least quarterly to determine if rebalancing is appropriate. Rebalancing will be done automatically by Efficient Market Advisors and all trades associated with a rebalancing will be reflected on each client account statement.
Holdings of taxable accounts will be reviewed periodically to determine if a “tax swapping” opportunity exists. Tax swapping is the act of selling one security and using the proceeds from sale to purchase another security that is expected to perform substantially identical to the security being sold.
Efficient Market Advisors, LLC does not charge commissions. We are not a Broker/Dealer and do not have custody of client assets. Broker/Dealers that carry customer accounts may charge commissions for transactions. We are an Investment Advisor registered with the SEC and charge a flat percentage fee based upon the assets in your account. We benefit when the value of your account rises. Investment advisory fees paid to a Registered Investment Advisor may be tax deductible, please consult with your tax advisor to determine your eligibility.
All fifteen Efficient Market Portfolios models have been constructed using Modern Portfolio theory and sophisticated financial modeling software. Target weightings of each asset class have been determined using a complex mathematical technique known as optimization. Model portfolios may change periodically as additional asset class performance data is included in our optimization process.
Working with your financial advisor will help you determine the appropriate asset allocation mix suitable for your risk profile and your investment time horizon. If you need help locating a financial advisor please call Efficient Market Advisors at 1-888-327-4600.
One critical component to success in investing many believe is to follow the age-old maxim “buy low and sell high”. Unfortunately for most investors this is more easily said than done. Rebalancing is the process of selling portions of ones investment in a particular asset class or security that has grown as a percentage of the portfolio to a level beyond its intended or target allocation. Proceeds from the sale are used to buy additional portions in another asset class or security that has fallen below its intended target allocation. In other words, “Buying Low and Selling High”.
Here are two hypothetical portfolios both initially comprised of 60% common stocks and 40% bonds, neither is rebalanced and both are potentially dangerous.
The first portfolio starts out in 1994. By the end of 1999 stocks had grown to represent nearly 80% of this hypothetical investor’s portfolio. Going into the years 2000, 2001, and 2002 an allocation of 80% stocks could have been very painful. Had the portfolio been rebalanced periodically, this investor would have entered the bear market with less exposure to stocks.
The second portfolio starts out in 2000, again with 60% stocks and 40% bonds. Because this investor did not rebalance his portfolio, his stock allocation dropped down to only 40% by the end of 2002. Had this investor periodically rebalanced his portfolio back to the original 60% stocks and 40% bonds weighting he would have had had a greater weighting in stocks going into the bull market of 2003.
Studies have shown that periodically rebalancing an investment portfolio between different asset classes such as stocks, bonds and real estate can significantly reduce the overall risk or volatility in your portfolio. For many investors, this means a smoother ride towards their financial goals making the process of investing less emotional. Not only can rebalancing between asset classes and investment styles reduce your portfolios volatility it may also enhance it’s returns over time.
With the help of their Financial Advisor, individual investors can choose from fifteen different asset allocation models in the Efficient Market Portfolios account. Our asset allocation models consider both an investors appetite for risk and the time horizon attached to meeting their investment goals.
Working with your financial advisor will help you determine the appropriate asset allocation mix suitable for your risk profile and your investment time horizon. If you need help locating a financial advisor please call Efficient Market Advisors at 1-888-327-4600.
