The Terminus Process

Our process allows potential clients to see how our investment strategy is different from what they’re currently doing, compare the two side by side, and let the potential client see something tangible and how it would apply to them specifically.  We do this absolutely free of charge.

 This is an initial introductory meeting where we discuss the services we offer in more detail.  After giving out our Company Privacy Policy, which basically states that everything discussed remains completely confidential, this gives us the opportunity to learn more about the prospective client through gathering information about their individual circumstances, short-term goals (i.e. college expenses, the purchase of a home or car, immediate hedging strategies to preserve capital, etc.), investment experience, risk tolerance (which is something we determine based on answers to specific questions), longer term objectives, expectations, liquidity needs, outside investments (401k, 403b, SEP-IRA, SIMPLE, 457, etc. or employee stock options, which we advise on these for no charge) current tax bracket, anticipated tax bracket, total net worth, liquid net worth, current income, required annual income (if necessary), etc.  This process typically takes 1-2 hours.

.  If we both think we might be a fit for each other, then we would like to get copies of all of their current investments, qualified accounts (tax deferred/tax free), non-qualified accounts (taxable investment accounts), in the taxable accounts we would need the registration of each account, a list of each individual holding including the name, trading symbol, CUSIP number if applicable, number of shares, purchase date(s), cost basis (average cost basis, cost basis on specific shares/multiple lots, total cost basis, or whatever is applicable).  Most of this information can be found on the statements from the custodian, or from whoever the assets are held with.

 We’ll put together what we call a Buy/Sell Hold analysis.  Using all of the information collected during our initial meeting, we’ll determine a target asset allocation, compare it to their current allocation, and run some growth projections going forward to show someone how our changes would impact their specific portfolio and give them a better idea of what to expect if they hired us.  We don’t do pie chart investing, which is when a broker or advisor recommends allocating a percentage of someone’s portfolio to multiple asset classes and then says to come back once a year for a rebalance, and then whatever asset has appreciated the most over the last year is reduced and the proceeds are allocated to whatever hasn’t done well, and this ends up with a nice pretty chart that stays looking the same.  Instead, we run a complete, in-depth portfolio analysis on each individual holding based on the current stock price relative to its intrinsic value, give you a full explanation of the rationale our recommendations, and this allows a prospective client to not only hear about what we do in general, but to see exactly how our investment strategy applies to their current holdings.

We determine a target allocation by investing a percentage of the assets to one or more of our portfolios, and this is determined based upon their needs and their risk tolerance.  Our recommendations would either be to increase the percentage weighting of one or more of their current investment holding by accumulating more shares in the position, hold onto the entire position, reduce the weighting of the position (maybe because we believe too much is invested in it from a weighting standpoint or it might be for tax efficiency if the entire position has an unrealized gain but only a portion of the shares are long term holdings), or we might recommend liquidating the entire position.  We’ll then put together a proposed portfolio, list the individual positions, percentage weightings of each, if it makes more sense to own a particular position in a tax deferred account or a taxable account, our rationale for buying each company, our target prices and what they’re based on, etc.

If a prospective client likes our investment process and the proposed portfolio analysis we presented and then decides to move forward and hire us to manage their investment portfolio, using the information gathered initially along with some new information we get from the client, we put together a Statement of Investment Policy, which is a document that is basically the guidelines we must adhere to when managing the portfolio.  The Statement of Investment Policy lists the client’s target asset allocation, if there are any needs for a cash reserve in this account for a future purchase or income needs, if annual income is needed from the account, and if so, how much, if deposits will be made on a regular basis, tax bracket of the client, assets held elsewhere, the approximate allocation of the assets held outside of what we’re managing, along with the analysis of the portfolio we’re going to manage, including the rationale for selling, holding, and buying anything included in our initial implementation.  There is a little bit of paperwork needed by the custodian to allow us to implement trades in our client’s accounts, and the Statement of Investment Policy includes the target percentage being invested in one or more of these portfolios.  We also meet with our clients at least quarterly to review this Investment Policy and make any changes if necessary, review the performance of the account, and explain the rationale for any changes made within the portfolio, which we send out via mail or email immediately after we decide to make any changes.  Additionally, we DO NOT custody client’s assets.  All of our client’s accounts are custodied with Charles Schwab & Co., but we do have the ability to manage accounts custodied with most broker/dealers.  Our clients receive monthly or quarterly accounts statements from their custodian.  In addition, we provide our clients with in depth performance reports so they can evaluate the overall performance of the accounts we’re managing.  We usually provide these quarterly, during our face to face meetings, to review the reports in more detail.  At any time, during the arrangement between our clients and us, our clients have the right to fire us and remove us from their account any time they want, but we have this right as well.

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Why Choose Us

  • Free initial assessemnt
  • Track record of satisfied clients
  • Conservative investment in volatile markets
  • Customer service record of always being reachable
  • We offer the intangibles that other asset management companies don’t

What Client’s Say

I appreciate the disciplined management which eschews the trendy stocks and searches  for sound investments in companies characterized by good management, competitive advantages, encouraging prospects for the future, and financial health.  I also like the proactive thinking that Michael exhibits in his briefings because the complexities and dynamics of commerce will likely punish anyone who is not constantly thinking about what’s best for his clients.
Tom Lee, President, Transwest Equities
Terminus has done an outstanding job managing my investments.  They provide me with timely and frequent updates to explain any changes they make in my portfolios, which makes me feel more comfortable and confident in their abilities.  After their initial analysis of my current investments, held with a different advisor at the time, they were able to point out some hidden fees, which I wasn’t aware of, and show me exactly how they could diversify my portfolios, reduce my overall risk, and increase my return, which has all happened since hiring them to manage my portfolios.  Being retired, I feel better knowing that Terminus has built a portfolio for me that I feel comfortable with, the portfolios generate more than enough income for me to live on during retirement, and the overall growth of my portfolios has exceeded my expectations.  I’m glad I made the change.
Rosalyn Cordell