My Day Job

Submitted by Rich Toscano on April 20, 2010 - 8:51pm
A while back, in reference to my personal move into the investment world, I wrote this:

Don't worry, I'm not going to start incessantly shilling for the new business. However, I may occasionally shill for the new business.

It's actually been 3 1/2 years since I put up that post, so I guess I didn't even live up to my threat to shill occasionally.  But now, on the occasion of our having recently completed a track record of our investment performance, I thought I'd take the opportunity to do so.

My firm, Pacific Capital Associates, is owned by me and a partner, John Simon.  We manage investment accounts for individuals, businesses, and trusts*. We also provide general financial planning advice to our investment clients.

Our investment approach is quite different from the mainstream.  From our FAQ:

In our experience, the vast majority of investment advisors end up with investments that are remarkably similar to one another and, by no coincidence, to the major stock market indices. We take quite a different approach. To put it very briefly, we combine the independence and rigour of traditional value investing with a heavy focus on global economic and monetary trends. The end results are investment allocations that are very different from those of the typical index-hugger, and ones that we think will provide our clients with superior long-term returns while exposing them to less risk.

In fact, we use the same fundamentally-driven and forward-looking analytical approach that I used here at Piggington to identify and analyze the housing bubble, except that we apply it to the broader investment markets.  This approach has been very successful, as our investment track record indicates:


A brief explanation of this chart: the blue line represents the asset-weighted  total return, after fees, of our discretionary managed portfolios.  The accounts are all separate, so few if any clients achieved this precise return.  (In fact, newer clients can vary quite a bit from the average because based on market conditions we might buy different investments for new clients than we are holding for existing clients -- but over time their returns tend to fall into line with those of longer-term clients).  Instead, this line represents the average quarterly performance, after all fees and weighted by portfolio size, for all our discretionary clients for each quarter.

The gray line represents the total return of the S&P 500 starting over the same time period.  The graph shows that we outperformed the market in both good times and bad, leading to much better returns for our clients in the long run.

For more background on the calculations, including the standard 1/3/5 year returns and so forth, please click here to view our full performance report. 

I am obliged to mention here that both sets of returns include reinvestment of all income.  I also need to reiterate the old classic: past performance is not indicative of future results!  We present these results not to suggest that we will achieve them again in the future, but to show that all the analysis and charts and generally nerdy stuff that we do can actually translate to real-world outperformance.

If you are interested in learning more about us, please feel free to visit our website and especially our FAQ list.  If you have any questions that aren't addressed there, drop me an email at rtoscano@pcasd.com.

And now, back to housing and the like...

(Note: All public content pertaining to PCA must be approved by a compliance lawyer.  This is fine for the occasional article or writeup such as this one, but it effectively prevents me from going back and forth in an online discussion.  I've therefore disabled comments to this post.  If you have any questions or comments, please email them to me directly at rtoscano@pcasd.com.)

* Investment advisory services and securities offered through Girard Securities, Inc., member SIPC/FINRA.

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