The Five Pillars of a Winning Active Management Strategy

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Brandon Pacilio

President and Founding Partner · View Bio
Five pillars of investment management - Gregoire Painvin, Alpine Hill Advisors

The investment needs of the wealthy can be complicated. To address them properly, Alpine Hill Advisors believe in active management, using a combination of individual investments that allow for customized and flexible portfolios. Being an active manager requires an advanced level of expertise and dedication, continually researching and analyzing securities to craft an investment solution specifically tailored to respond to an individual investor’s needs. This makes us better equipped to respond to changing capital market expectations, identify mispriced or undervalued opportunities and make better informed investment decisions.

What really differentiates one investment management firm from another? There are many characteristics for you to consider, but perhaps most important to a successful advisor relationship is an alignment in philosophy. We believe that an investment strategy should not be limited to just active or passive management. Rather, we seek to provide a strategy that is an appropriate combination of both.

As active managers, we have the flexibility to customize investment strategies based on individual client needs and goals. Those may include direct stocks, direct bonds, ETFs, alternative investments and cash. Working closely with our clients, we determine their specific risk tolerance, time horizon, and specific investment preferences and create a unique allocation strategy using a blend of active and passive investments.

As Chief Investment Officer, my experience as a research analyst is continually called upon to actively manage customized portfolios for our clients. It requires constant monitoring of portfolios to keep them aligned with each client’s overall investment plan. We deploy a Separately Managed Account (SMA) strategy that is laser-focused on delivering transparency, liquidity and tax efficiency to these portfolios. It also allows the client to feel more in control of their investments.

For this purpose, we abide by a set of guiding principles, or pillars that we refer to as the ‘Five A’s of Alpha’:

Pillar I: Active Management

We don’t sell products – we create customized, proprietary models for our clients. After establishing a client’s asset allocation priorities, their portfolio remains nimble and flexible in order to successfully navigate changes in the markets. This allows us to make tactical allocation decisions, such as shifting investments between different asset classes or sectors. We employ risk management techniques to potentially mitigate downside risks and protect capital during market downturns.

Pillar II: Autonomy

Financial advisors, especially those belonging to a platform, may be hindered by constraints and conflicts regarding their selection of investment options. As an independent RIA, we are not hampered by these constraints and can provide unbiased guidance and advice in addition to greater transparency.

Pillar III: Access

To ensure the efficacy of our positions, we have built a partner network of top-notch service providers with independent insights and institutional research capabilities. We can then make hand-picked managers of fixed income, equities, alternatives and other appropriate asset classes available to clients at better terms than what they would pay directly. Deploying a team of experts to help us exercise deft judgement and analysis allows us to provide innovative solutions and make highly educated decisions on the client’s behalf.

Pillar IV: Adaptability

Market shifts and volatility as well as new opportunities require us to stay responsive and vigilant. An SMA strategy allows us to make necessary adjustments to continue fitting within the client’s established needs and take advantage of market opportunities or react to changing economic conditions.

Pillar V: Alignment of interests

As a client-centric firm, we put our clients’ interests first. In the spirit of trust, transparency and communication (key tenets of our client relationships), our conviction in our own strategies allows us to confidently invest alongside our clients. By earning client confidence, we are able to help them maintain a long-term focus and avoid the pitfalls of emotional investing.

Summary

Our investment platform and our philosophy provide clients with access to portfolios that are not otherwise available through a single source. Our SMAs are diversified across asset classes, security types and managers to achieve the necessary customization, flexibility reduced risk, liquidity and tax efficiency for clients.

If you have comments or would like to discuss our innovative approach to asset allocation, I would like to hear from you.

Thanks for reading.

Greg

Gregoire Painvin
Chief Investment Officer and Founding Partner
Alpine Hill Advisors

Gregoire Painvin is Chief Investment Officer of Alpine Hill Advisors, a Westport, CT Registered Investment Advisor firm. If you would like to contact the author, please e-mail him at gpainvin@alpinehilladvisors.com or call 720-794-5796.

The information provided is for educational and informational purposes only and does not constitute investment advice and it should not be relied on as such. It should not be considered a solicitation to buy or an offer to sell a security. It does not take into account any investor’s particular investment objectives, strategies, tax status or investment horizon. You should consult your attorney or tax advisor Alpine Hill Advisors LLC (“Alpine Hill”) is a registered investment advisor. Advisory services are only offered to clients or prospective clients where Alpine Hill and its representatives are properly licensed or exempt from licensure. Please visit our website https://alpinehilladvisors.com for important disclosures.

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