Integrated Portfolio Solutions - Client Welcome

Integrated Portfolio Solutionssm
Your Guide to the Hilliard Lyons Unified Managed Account
Your Solution to Investing
Is your portfolio spread among too many overlapping investments that
no longer match your goals and time horizon? If so, Integrated Portfolio
Solutionssm, Hilliard Lyons’ Unified Managed Account may be your solution.
With it, not only will you be able to consolidate multiple statements and
accounts, but you will also be able to invest in a professionally-managed,
diversified portfolio based upon your risk tolerance and time horizon that
periodically rebalances.
Our consulting process helps us to find and focus on your financial goals and
objectives. The consulting process consists of four steps:
Choosing an approach to
investing should involve
a defined process to
diversify your assets and
manage risk. Hilliard
Lyons’ Integrated Portfolio
Solutionssm can provide you
with that process.
Defining Investment Objectives and Goals:
This step takes into consideration your goals and objectives, risk tolerance,
desired rates of return, time horizon and cash flow/income needs.
Asset Allocation:
This step is the primary factor in managing the risk of a portfolio and achieving
desired investment returns. Utilizing a mix of equities and fixed income, along
with other asset classes will help optimize the potential of achieving your
desired investment results while staying within your preferred risk tolerance.
Diversification does not assure a profit or protect against loss.
Evaluation and Selection of Investment Vehicles:
Investment vehicle selection is the third step in this process. Your investment
objectives and risk constraints established earlier in the investment objectives
and goals stage are crucial to this phase in the process. We will work with
you to create a portfolio of managers that are best suited for your particular
situation.
Reviewing and Monitoring:
The final step is to review and monitor the account and investment vehicles
continuously over time. On a periodic basis, you will meet with your Financial
Consultant to review the selected managers, portfolio allocation and your
investment goals and objectives to ensure that the selected strategy is still on
track to meet your long-term goals.
Investment Insight
for Every Generation
Since 1854 sm
Integrated Portfolio Solutionssm Program
Through the consulting process, Integrated Portfolio Solutionssm provides asset allocation and diversification with the use of
SMAs (separately managed accounts), mutual funds and/or ETFs (exchange traded funds), offering flexibility, control and
professional investment management.
Define:
Investment Objectives
& Goal
Client &
Financial
Consultant
Review &
Monitor
Design:
Asset
Allocation
Evaluate & Select
Investment
Vehicles
High Quality Investment Management Team
Due Diligence Process
The manager selection process for Integrated Portfolio
Solutionssm includes multiple layers of unbiased due
diligence. This process begins with our third-party due
diligence provider and is overseen by our Investment
Advisory Committee.
The selection of investment managers is a critical step.
The goal of the process is to find skillful managers
in each of the asset classes or categories and to
eliminate managers that do not meet specified criteria.
Unfortunately, there is no single proven objective test
that can identify managers who will perform well in
the future. Past performance alone is a poor predictor
of future results. While quantitative data such as
risk measures, style and other portfolio statistics are
important, qualitative factors are critical to the selection
process. These include the firm’s decision-making
process, and the experience and breadth of the firm’s
management/personnel.
DiMeo Schneider & Associates
DiMeo Schneider is a third-party consultant based in
Chicago, IL, who provides research and due diligence
on the mutual funds and SMAs offered in Integrated
Portfolio Solutionssm. DiMeo Schneider also provides
the asset allocation models for this program. DiMeo
Schneider follows a five step process in investment
manager selection. Each investment vehicle is monitored
based upon the same standards each quarter.
While many consulting firms utilize quantitative
screens, DiMeo Schneider does not stop there. The
first three steps of the process are designed to produce
Integrated Portfolio Solutionssm Program
INITIAL SCREENS
 Style Analysis
 Proprietary multi-factor
model
 Compared to peer(s)
and benchmark(s)
 Portfolio composition
QUALITATIVE REVIEW
 Portfolio characteristics
 Expenses
 Assets managed
 Market capitalization
 Duration
CUSTOM QUESTIONNAIRE
& ANALYSIS
 Investment and
non-investment
assessment
 People
 Process
 Philosophy
 Performance
 Risk Management
 Operational
a manageable number of candidates for face-to-face due
diligence. The insight and experience of the Investment
Committee plays a crucial role. The goal is not to find
the “hottest” manager. The belief is that if you can avoid
mistakes, you may improve overall portfolio performance.
In the course of a year DiMeo Schneider will perform
multiple on-site visits and host telephone calls with
managers. In the manager meetings, the emphasis is
placed on areas that cannot be ascertained by quantitative
performance analysis: organizational structure, productspecific information, infrastructure, philosophy-buy/sell
discipline, portfolio construction, performance, trading
and compliance.
Hilliard Lyons Investment Advisory Committee
The Hilliard Lyons Investment Advisory Committee
is comprised of experienced investment professionals
from our Home Office, based in Louisville, Kentucky.
The Committee is responsible for working closely with
DiMeo Schneider to ensure a thorough due diligence
DEEP-DIVE RESEARCH
 The 4 “Ps”
 Organizational structure
 Succession plans
 Compensation
 Compliance systems
 Trading process
 Portfolio construction
 Buy/Sell discipline
 Composite methodology
 Portfolio holdings
 Legal & regulatory
concerns
COMMITTEE APPROVAL
 Investment Committee
 10 members
 Partners
 Sr. Consultants
 Sr. Analysts
 Robust review and
debate
 Majority approval
required to include/
retain manager
 Results in 5 to 7
managers per asset
class
process, and also develops Fixed Models (home office
discretionary models). The Committee has:
•
86 years combined investment experience
•
CFA, CFP® and CWA® professionals as voting
members
•
A disciplined process for reviewing managers and
Fixed Models
The Role of Your Advisor
Your Financial Consultant is the next step in your
solution to investing. By completing the Risk Tolerance
Questionnaire and discussing your financial goals and
objectives with your advisor, this will determine your
asset allocation and provide direction in terms of the
investment vehicles to be utilized in your portfolio.
Your Financial Consultant acts objectively and provides
ongoing evaluation of your portfolio based upon your
stated goals and objectives.
Integrated Portfolio Solutionssm Program
Based on your investment objectives, risk tolerance,
and time horizon, your Financial Consultant will help
you select an asset allocation to fit your needs. Each
allocation is flexible and can be customized to fit your
individual situation. The five allocation types from
which to choose are:
Aggressive Growth Portfolio: The aggressive growth
portfolio is designed for a long-term investor who can
tolerate high portfolio volatility in pursuit of high longterm rates of return. Security of capital is secondary to
capital appreciation.
Growth Portfolio: The growth portfolio is designed for
a long-term investor who can tolerate the investment
risk associated with seeking higher long-term capital
appreciation and protection against inflation. Security of
capital is secondary to capital appreciation.
Moderate Portfolio: The moderate portfolio is designed
for an investor who can tolerate the investment risk
associated with seeking capital growth and current
income as equal priorities over a long-term time horizon.
Conservative Portfolio: The conservative portfolio is
designed for a short to medium-term investor who wants
current income but also seeks returns that are higher
than those available from cash equivalent assets.
Contact Your Financial Consultant
At Hilliard Lyons, we make your financial needs our
priority. For an in-depth assessment of your financial
goals and objectives, meet with your Financial
Consultant to complete the Risk Tolerance Questionnaire
and receive an Integrated Portfolio Solutionssm Proposal.
Balanced Portfolio: The balanced portfolio is designed
for an investor who seeks long-term growth of capital,
but also strives to reduce volatility by diversifying with
equities and fixed income investments.
Securities and advisory services offered through J.J.B. Hilliard, W.L. Lyons, LLC, a registered investment advisor and broker dealer. Member NYSE,
FINRA & SIPC. Investing in securities involves risk, including possible loss of principal. ©2012. All rights reserved. Rev. 12/13.