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Providing Forward Thinking Financial Advice

Wealth Management:



The above image, from stockcharts.com, is a chart of the S&P 500 in the last 20 years. Depending on the time period considered, the stock market has 3 different possible directions. The stock market can move up, down or sideways! Our primary belief is that generally the stock market goes higher, however, there are periods that have produced pronounced downturns and extended sideways moves which can last for months or even years.

Passport Wealth designs, builds and manages 4 Tactical Models and 2 Passive Models using the Charles Schwab Institutional Platform. Passport Wealth performs daily updates and reviews of its proprietary Portfolio Algorithm, which aides in the management of the Models.



Portfolio Construction and Design

The Passport Wealth Portfolios are systematically built and managed in the Charles Schwab Institutional Platform. Passport Wealth mainly invests client accounts into low cost and very liquid No Transaction Fee Exchange Traded Funds (ETF's).  Each of the Portfolio Models will be composed of about 5-12 different ETF's, which create extremely low cost and well diversified portfolios.

Clients are able to view their accounts at all times through the Charles Schwab Website and the Ausdal. Clients are asked to complete the Risk Level Calculator to determine the risk level and model that is appropriate for their accounts. A client may use more than one of the Passport Wealth Models.

Passport Wealth will connect with its direct clients every 30, 60 or 90 days to provide an update on the accounts and important economic and market conditions.Performance reports will be emailed to clients in a time frame of their choice. Outstanding service and attention to client's needs is a primary focus of the Passport Wealth Experience.



Tactical Models

Each of the 4 Passport Wealth Tactical Models are managed with the assistance of the proprietary Algorithm, which is updated every day the market is open for trading. A daily review and analysis of economic, market and technical conditions is performed to determine if the current risk level of the model is appropriate or if an increase or decrease in the risk level seems justified.Each model has the capability to change from very conservative to more aggressive by changing the holdings inside of the accounts. The goal of the Tactical Models is to be in a more conservative posture during market downturns and in a more aggressive posture during market upturns. The 4 models are Xtra Conservative, Conservative, Growth and Aggressive.

Each Model or Portfolio has the following KEY characteristics:

  • Variable Risk Level - As mentioned above, a daily review of the current risk level is performed. If the current level seems inappropriate, a change can be made to raise or lower the risk level by changing the holdings of the accounts.  Risk levels range from 1 (minimum risk) to 100 (maximum risk).
  • Maximum Risk Level - Each of the 4 models has its own maximum risk level which matches the risk level appropriate for the clients in that model.
  • Minimum Risk Level - When prudent, the risk level may be lowered to about 1, which is the lowest risk level. This can be accomplished by moving all of the funds in each client account to a money market or cash. This is a position of maximum safety and it is not done often, however, it can be done anytime.
  • Personalized Risk Level - Passport Wealth developed a Risk Level Calculator to determine the appropriate model for each client.

Favorable Conditions for the Tactical Models: The most favorable market environment for the Tactical Models is a market with a constant trend, either a strong up market or a strong down market. The model will recognize the trend and will invest either closer to the Maximum Risk Level or the Minimum Risk Level.

Unfavorable Conditions for the Tactical Models: The least favorable market environment for the Tactical Models is a market which has no long term identifiable trend. An example of this is the stock market from about 7/2015 to about 5/2016. One week or month the market looks very favorable and the next week or month the market looks really unfavorable. High volatility and big and violent ups and downs create a more difficult environment for the Tactical Models.



Passive Models

Passport Wealth has 2 passive models available. Each model will keep a similar and constant risk level regardless of economic or stock market conditions. Passport Wealth will perform daily monitoring of the accounts, will make sure accounts are allocated appropriately and will perform re-balancing when necessary. The models will be very tax efficient since trading will be kept to a minimum and the overall costs of the models will be very low. The Passive Models will not sell all holdings and move all of the funds to 100% cash.

Passport Wealth 60/40 Passive Model: This model will invest about 60% of the account value in Broad Market ETF's, like S&P 500 positions, and 30% in bonds, government or corporate, and about 10% in cash. The goal of this model s to track the S&P 500 at about 60% of the velocity.  This means that if the S&P rises or falls 10%, this model should go up or down about 6%.

Passport Wealth 90/10 Passive Model: This model will invest about 90% of the account value in Broad Market ETF's, like S&P 500 positions and about 10% in cash. It may invest about 10% in international or other more narrow positions, like technology or small companies. The goal of this model is to track the S&P 500 at about 90% of the velocity. This means that if the S&P rises or falls 10%, this model should go up or down about 9%.

Favorable Conditions or the Passive Models: The most favorable market environment for the Passive Models is a rising market. Since the model tracks the market at a predetermined speed, a rising market will create the best results. This model ignores economic and stock market news and does not react or change based on negative or positive news. Shorter term, volatile market conditions do not affect this model much as long as the long term trend is higher.

Unfavorable Conditions for the Passive Models: The least favorable market environment for the Passive Models is a falling market. Since this model ignores negative news and maintains similar allocations and risk levels, a falling market will be negative for this model. Downward volatile conditions will also result in negative performance. Once the market resumes its uptrend, the model will begin to rise. Clients in this model will have to exercise patience and could have to endure losses during market downturns.



The Passport Wealth Commitment

Passport Wealth is committed to assisting you at the highest levels of service. You are not a number to Passport Wealth, instead you and your satisfaction are of the utmost importance.  Passport Wealth is consistently striving to perfect its knowledge, delivery, communications and service.

To connect with Passport Wealth, learn more about our services and obtain current information on our investment models, please contact us or click below to send us a message.