by Tom Bradley

No, it’s not a teaser ad: “Up to a 9.4% return!”

Nor is it like other ads that promote, “Our best fund over the last three years earned 9.4%.”

No, I’m referring to the fact that our clients averaged 9.4% (after all fees) over the last five years (ending September 30th). If you looked at all our client statements and averaged the returns, it would show 9.4% on the bottom left portion of page 3.

How did they do it? Well, like anything, there’s a whole bunch of factors that went into it.

The biggest ones are asset mix and client behavior.

  • Our clients are always well diversified and they know what their asset mix is. It’s on their statement every quarter and we talk about it during every conversation we have.
  • And our clients are nails when it comes to dealing with weak markets. They do more buying in down periods than selling. They’re amazing. We’ve seen no evidence of bailing out at the bottom or piling in at the top, so there’s been no slippage between what/how our fund managers and clients are doing.

The next biggest inputs are costs and fund returns.

  • Our clients pay an average fee of 1.0%, all in. Our larger, long-standing clients are well below that due to our fee reduction program that rewards loyalty and the size of commitment.
  • Our long-term returns for balanced portfolios have been excellent. Even though the last three years have just been OK, the 5-year returns are solidly above index funds and well into the first quartile for periods beyond that.

And then there are a whole bunch of intangibles like advice, communication and reporting.

  • Our investor specialists are real pros. They know their stuff and are immersed in the Steadyhand way. And hey… they answer their phones.
  • As for reporting, we write a lot. Sometimes it’s frivolous, but mostly we’re trying to put what’s happening in the capital markets into words that people can understand.
  • For 9½ years, our clients have known how they’re doing, what they’re paying and what their asset mix is.

To borrow a term from the tech world, 9.4% comes from having a fully integrated ‘eco-system’. Think Apple.

Successful investing isn’t just about hot managers and low fees. There are a whole host of factors that go into it, the most important being asset mix and investor behavior. At Steadyhand, we’ve designed the firm so all the pieces point in one direction – higher client returns.

Management fees and expenses all may be associated with mutual fund investments. Please read the prospectus before investing. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated. The indicated rates of return are the historical annual total returns including changes in unit value and reinvestment of all distributions and do not take into account sales, redemption, distribution or optional charges or income taxes payable by any securityholder that would have reduced returns.