Philosophy

Successful investing is based on three principles: the management of return, risk and costs. Just like a three legged stool needs all three legs to stand, we believe all three aspects of the investment process have to be tended to produce good, long-term results.  The investment industry, for the most part, acknowledges and addresses the return and risk aspects of investing, conveniently leaving costs aside.  To illustrate, the impact of cost is so pronounced that even a 1% marginal increase in costs, compounded at 10% a year, over a 20 year time frame, leaves the investor with 20% less portfolio wealth.  In other words, without this 1% incremental cost, the investor would be 20% wealthier. 

IMI is a unique firm that researches, architects and executes investment strategies that are cognizant of the three principles of successful investing.  At IMI we create active investment strategies with extremely low turnover, as turnover happens to be the biggest culprit behind discretionary costs.  Portfolio turnover not only generates transaction costs, but makes unrealized gains realized, triggering capital gains taxes in the process.  By minimizing turnover while seeking excess return we are able to not only earn a dollar, but also to save a dollar for our clients.

 

 

 

Copyright © 2005 Investment Management Institute, LLC