The element of risk must be understood and managed when building investment portfolios, for most investors, the risk is merely a question of how much they are prepared to lose. Understandably, the word "risk", raises negativity, even though risk is actually a positive factor. Despite the thoughts of many, very few investment options are risk free, funds deposited and held within your personal bank account are at risk through the effects of inflation or the downturn of economies, recent events have shown us the volatility within the banking sector with a number of banking houses becoming insolvent. The saying "with great risk comes great reward" does not always come to fruition, the challenge when designing an investment portfolio is to make certain that any risk taken has a high probability to reward the investor with an adequate return. Risk is much easier to quantify when there are financial parameters to work within, if you know what the maximum return value is over a given period and what the maximum loss could be, then you can calculate if this is within your investment expectations and risk tolerance. By concentrating on the management of risk, Green Plus can reduce much of the vicissitudes often associated with an investment, achieving more consistent returns. Risk is much easier to quantify when there are financial parameters to work within.
In the world of institutionalized wealth management, much attention has been paid to the idea of managing risk. Investors have been conditioned to believe that mutual funds and other products can mitigate risk and deliver "predictable" returns that parallel popular historical indexes. There's a fundamental flaw in this logic: Risk is not a number. It's a concept; it can't be effectively "managed" without limiting the potential in an investment portfolio. Rather than reacting to the perception of risk, the real focus of investing should be understanding market volatility and accounting for it in decision-making. In contrast, modern portfolio theory seeks to minimize risk through over-diversification. It looks backwards at volatility and manages assets to an acceptable benchmark. And too often, the results are unimpressive. At Green Plus planning for volatility means we have to think differently and make better decisions. We're curious in our study of the global economy, creative in the way we identify opportunities, diligent in our research, and intentional in our allocations. We focus on the things we understand-and look beyond conventional wisdom. As thoughtful and active managers of every client's allocation, we pay attention to every transaction. In short, Green Plus has a different attitude about risk-and we take a different approach from most wealth managers. We apply all of our knowledge, experience and creativity to one client portfolio at a time providing the right information at the right time to allowing our clients to make the right choices. Green Plus we believe the best way to make an investment decision is on what's going to happen not what's already happened.
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