Peace of Mind.

We help alleviate our clients’ concerns about the financial future so they can sleep well at night. Our investment strategies, some of which are highlighted below, allow us to significantly reduce our clients’ portfolio risk (i.e., volatility) while simultaneously maintaining or even increasing return. Knowing that they’re on track to achieve their most important goals provides our clients with enduring peace of mind.

Research-Proven Methods.

You’ll notice that we repeatedly cite academic research when we’re discussing portfolio management. We believe that successful investing is much more science than art, and that your hard-earned assets shouldn’t be put at risk based on subjective opinion. Sadly, many other advisors do just that.

Discipline.

Successful investing requires exceptional discipline. While everyone knows that buying low and selling high is the way to build wealth, most investors (and even many advisors) are ruled by their emotions, selling an investment after it has fallen considerably and buying after a meteoric rise. At Sierra Wealth Advisors, we create customized portfolios that our clients are able to buy and hold through all market cycles. We also rebalance our clients’ portfolios regularly, causing us to sell asset classes at higher prices and buy other asset classes at lower prices.

Passive Investing.

We don’t try to select individual securities, time the market, or use mutual funds with “active managers” who engage in those practices. There is little evidence to support such practices and, in fact, academic research overwhelmingly indicates that the vast majority of active managers under-perform their passively managed peers. While there are always a few active managers who do beat the market, identifying them in advance is virtually impossible and, even more importantly, academic research indicates that they rarely continue to outperform.

Exclusive Investments.

Clients of Sierra Wealth Advisors have access to asset class mutual funds that are not available to the retail investor. These no-load funds accurately represent their respective asset classes (more so than virtually any other funds available), are broadly diversified, low-cost, and relatively tax-efficient. Read on to learn why these attributes are so important.

Broad Diversification.

We not only ensure that our clients are well diversified within each asset class, but we diversify client portfolios over a dozen or more different asset classes. Intelligent asset allocation not only can reduce overall portfolio risk but can also increase compound return. Over the past 35 years a diversified portfolio of stock asset classes could have produced a compound annual return approximately 1.5% higher than a portfolio invested just in U.S. large cap stocks. On a $1,000,000 initial investment, that would add approximately $2,400,000 to the ending value after 20 years.

Low Costs.

Lower investment expenses mean that you keep more of your total return. In fact, research shows that active managers generally under-perform their passively managed peers by the difference in management fees. Lower fees can add 0.5% or more in total return, per year, and mutual fund management fees aren’t the only costs that can be reduced. The asset class mutual funds we use have trading costs that are much lower than average, something you won't find disclosed in a mutual fund prospectus. This means that total cost savings alone may more than cover our advisory fees. For more information, visit our Fees & Costs page.

Tax-Efficient.

Minimizing taxes on investments is critical. As is the case with other investment costs, the more you pay in taxes, the lower your total return. Frequent turnover of assets generates capital gains and a corresponding tax burden. Short-term capital gains are taxed as ordinary income, making them particularly egregious. Due to their reduced turnover, passively managed funds are generally much more tax-efficient than actively managed funds to begin with. For taxable accounts of investors in the top tax brackets, it may make sense to go a step further and use funds that are specifically managed to keep taxes to a minimum. While the expenses on tax-managed funds can be a little higher, the tax savings can more than make up for the additional expenses, effectively increasing the total return for the high bracket investor.

Small Cap and Value Stocks.

While creating a portfolio from numerous asset classes is crucial, not all asset classes are created equal. Historically, small cap stocks and value stocks have produced returns significantly higher than large cap stocks and growth stocks, respectively. While investing all of your assets in these historically high-performing assets classes would be irresponsibly risky, Sierra Wealth Advisors places additional emphasis on these asset classes as part of a diversified portfolio to produce even higher returns without significant, if any, additional risk.