Banach Wealth Management

• Tactics smooth out strategic portfolio return changes
• Tactics change with time horizons and risk tolerances
• Satellite asset tactics must often be more complex
  than core asset tactics
• Tactics include both change from and return to
  strategic wealth allocations and cash flows
• Tax management tactics smooth out returns

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• 2009 Year to Date Total Returns
  S&P 500 (1057)                         19%
  US 10 Yr Bond (3.31%)            -17%
  NASDAQ (2122)                         34%
  Foreign (EAFE) Stocks                22%
• U.S. GDP expected contraction   -2.3%
• 2009 earnings expected decline -11.7%
• Stock markets hit bottom in March
• Economic recovery started

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• Risk Awareness (self/asset/markets) is vital
• Resource capital (human/financial) shapes
  wealth (accumulation/distribution) cycle
• Wealth process counts in long time horizon
• Objectives lead to strategies, which should
  be tested with scenario analysis

• Decide on wealth strategy accumulation and
  distribution time horizons carefully
• Select investment portfolios, pensions, and
  annuity weights based on personal risk
  tolerances and risk boundary stress
  reduction points
• Input your investment and annuity portfolio
  at your age into a wealth cycle spreadsheet
  by requesting it at jabanach@gmail.com
  Play with it.  Does your strategy achieve
  your wealth objectives?

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• 2009 Year to Date Total Returns
  S&P 500 (1020)                     15%
  US 10 Yr Bond (3.40%)         -19%
  NASDAQ (2009)                     27%
  Foreign (EAFE) Stocks            16%
• U.S. GDP expected contraction = -2.4%
• 2009 earnings expected decline = -12%
• Stock markets hit bottom in March
• Recession at statistical end

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• Tactics should adjust strategic risks
• Riskier investment portfolio strategies
  require more sensitive tactical controls
• Set tactical risk control boundaries within
  emotional and financial tolerances
• Recognize the risks that specific tactics
  add to strategies

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• Design strategy for your personal needs
• Study matrix of asset attributes
• Keep it simple; strive for market returns
• Implement diversification; consider asset
  classes and scenarios
• Strategies determine primary cash flows;
  (Chapter 14 tactics fine tune to specific needs)

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• 2009 Year to Date Total Returns
  S&P 500 (987) 10.5%
  US 10 Yr Bond (3.50%) -21%
  NASDAQ (1978) 25%
  Foreign (EAFE) Stocks 11%
• U.S. GDP expected contraction -2.4%
  
• 2009 earnings expected decline -13%
• Stock markets hit bottom in March,
  as the economic recession nears an end

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• Misunderstood multi-dimensional concept
• Returns, costs, cash flows, liquidity, location
• Unstable risk or unknown uncertainty?
• Scenarios change diversification value

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• First Half 2009 Total Returns
  S&P 500 (919) 3%
  US 10 Yr Bond (3.52%) -20%
  NASDAQ (1835) 17%
  Foreign (EAFE) Stocks 2%
• U.S. GDP expected contraction -2.6%
• 2009 earnings expected decline -14%
• Stock markets likely hit bottom in March,
  as the economic recession eased

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