Archer’s approach uses index investing to structure a diversified and personalized portfolio that minimizes risk, costs and your tax bill.
- Modern Portfolio Theory
- Index Investing using Exchange Traded Funds
- Asset Allocation to Fit Your Profile
- Disciplined Rebalancing
Modern portfolio theory, developed by the Nobel Prize Laureate in Economics, Harry Markowitz, forms the basis of all portfolios managed by Archer. We allocate your portfolio among the major asset classes in order to maximize the expected return for a given level of risk. The asset classes in which we invest include Canadian, US, international and emerging market equities and bonds, as well as alternative investments such as real estate
We use Exchange Traded Funds (ETFs) for each asset class in your portfolio. Each ETF represents a class or subclass of assets and is selected based on its liquidity, structure and costs. It has been shown that over long periods, the vast majority of active portfolio managers fail to beat stock indices. On average, they underperform their index by an amount equivalent to their expenses. It is therefore preferable to buy all the securities making up the index while minimizing fees, as ETFS do.
Your investment policy and asset allocation are based on your profile, determined through a rigorous financial planning process. Regular follow ups ensure that your investment policy is adjusted as your personal situation evolves.
Income taxes can have a significant impact on your performance. Your portfolio is therefore structured to optimize after-tax return; i.e. we allocate securities in your different accounts according to their taxation affinity. We also take advantage of opportunities to harvest tax losses in order to reduce your tax bill.
We continually monitor your portfolio and, if necessary, rebalance each asset class to its target weight, in order to ensure optimal risk / return. We also consider the tax impact whenever a deposit, withdrawal, dividend or market movements justify rebalancing the portfolio.