Welcome to the third installment of the Master’s 2nd Quarter blog series, devoted to the reasoning behind our recent transition to our own Registered Investment Advisory (RIA) firm. Last week, Charlie outlined our company’s history and the core pillars that it was founded on that provided the foundation for why we made this transition. This week, I will discuss the enhanced flexibility we have from an investment perspective and why we feel it will be a benefit to our clients.

At Master’s, our investment management philosophies are rooted in academic research that has been compiled over many years. This research has uncovered a handful of factors that can lead to higher return expectations over long time horizons. These factors are what our managed models are tilted towards. On the equity side, this means we prefer greater exposure to companies that are more profitable, smaller companies over larger ones, and less expensive companies over more expensive ones. On the fixed income side, we focus on term and credit, seeking to dynamically adjust our portfolios as necessary based on changes in the bond market over time.

One of the reasons we decided to make this transition is because it gives us enhanced access to the investments that we feel best reflect our investment convictions. Our goal has always been to have our various model portfolios as closely aligned as possible with our factor-based investment strategy. This transition has provided us with a greater ability to do just that! We now have easier access to investments that our team believes align best with our investment philosophy. This closer alignment will allow us, through our internal Investment Review Committee, to implement our portfolio management strategies more efficiently and effectively. We feel that this will lead to better outcome expectations for our clients.

Once again, thank you so much for your continued patience as we finish this transition. We appreciate your trust in our team and do not take it lightly.