Managing the Downside of Investing
It’s often said that “the best defense is a good offense” and that rule certainly applies when it comes to building a sound retirement system.
For the individual investor who is approaching or in retirement, the most problematic risk is Sequence of Return Risk… or, the risk that market declines in the early years of retirement, paired with ongoing withdrawals, could significantly reduce the longevity of a portfolio.
You see, dramatic or large drawdowns in investments can have far-reaching consequences that could
take years and require significant market gains to recover from.
This is particularly true for investors early in retirement, where the recovery time is short, and the effects of a mistimed downturn are amplified.
Investment performance is another uncontrollable factor that investors need to consider in their overall financial planning.
Because markets can be adversely affected by any number of factors… such as world politics, inflation, or weather… loss outside a defined risk budget can severely impact individual portfolios.
Look, the only two things we can control are risk and process. At Cutter Financial, our risk-managed approach to investing is designed to protect against the downside and help you succeed in all markets, bull, bear or neutral.
Cutter Financial utilizes a mix of tactical and strategic institutional strategies using quantitative data to help preserve capital in times of market stress. You see folks, if we manage the downside, well, the upside can take care of itself.
What is your risk budget and your process? Do you know? Contact us today to find out more about how to design and deploy your sound retirement system to help ensure your peace of mind through retirement.