Asset Management
SoHo's investment advisory services are an integral component of our overall goals driven approach to advising wealthy families. In this approach, a client's objectives are quantified and categorized according to the nature of the need, the timeframe in which it will mature, and the level of risk the client feels is acceptable in relationship to the goal.
In a process commonly known in the institutional investment management world as asset/liability matching, once the parameters of quantification, timeframe and acceptable risk are determined, assets are set aside to meet the objective, and generally held in the optimal relevant structure from an income, gift, estate or philanthropy management perspective - e.g., trust, partnership, LLC, etc. Then, a disciplined and diversified asset allocation appropriate to the risk tolerance and time horizon is determined using modern portfolio theory based techniques, and tested using state of the art optimization and simulation models. The allocation for each pool of assets is also considered in the context of the asset allocation of all assets - which have been similarly measured and assigned to an objective - so that the client's overall asset allocation is consistent with the client's overall risk tolerance and return and liquidity requirements.
In implementing the allocation, entity by entity and overall, SoHo starts with the premise that risk should only be undertaken to the extent necessary to achieve the objective. For most of our clients, risk is not necessary, but instead is a preference. Our role is to provide clarity so that clients can be informed, deliberate and intentional about risk and return. But regardless of whether risk is a preference or a requirement, SoHo strives to achieve broad diversification both across and within asset classes to reduce the volatility that is inherent in any portfolio.
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