The Family Wealth Consulting Group is a family financial-planning firm founded by Craig and Peggy Martin in San Jose, CA serving Silicon Valley executives and businesses. The Professional Team at FWCG prides themselves on always being available to inform and educate our clients about their best choices and then help them execute successfully on all areas of their financial lives. The Professional Team at FWCG communicates or meets regularly with clients so we can be currently aware of the most important issues that are critical and timely for each client. The Professional Team at FWCG is dedicated to providing experienced, educated and independent financial advice to our clients so they can make an informed decision that will meet their needs.
FWCG Opportunity Fund, LP – A unique diversification tool for alternative investments
The FWCG Opportunity Fund, LP (Opp Fund) sets up a side-fund for each client, giving them the choice to invest into any deal of their choosing, when to invest and also how much they want to invest. The fund offers a constantly changing list of professionally vetted alternative investments each year in all categories so clients are increasingly diversified across managers – management styles – over time – in multiple business models – in successive economic cycles – using evolving allocations.
In 2011 we began searching for alternative investments for the Opp Fund and were able to find many investments with long track records of earning 2X or more compared to what their risk-adjusted benchmarks were performing. An actual example for clients in the Opp Fund are the four different real estate general partners many clients started their investments with in 2011 who had 20-30 year track records of producing 20% IRR or better if investors had put $1 into each of their prior addresses. A common index would be the NAREIT but it only produced something less than 10% IRR over comparable time frames. Unlike the efficient publicly traded stock market, where there are no managers with such outperformance for that time frame, this outperformance track record convinces us that alternatives are in an increasingly inefficient market. That means to us that we can expect the best alternative managers to be able to produce consistently higher returns than is available by just buying and holding all the securities of an identical market. For the five year period ending 2015, that is what has happened with the four real estate limited partnerships that have been selling dozens of addresses that were held for the last 5 years producing consistent superior returns ranging from 5% IRR to 65% IRR, with an average probably closer to 25% IRR.
Because we have found alternatives to be in an increasingly inefficient market we are very excited about researching the database for superior performing managers in all fields, then performing professional due diligence in what has become a successful effort at finding those managers with consistent outperformance.
Investment Methodology – Diversification Is Your Only Safety
All of our clients are allocated to an effectively diversified portfolio of multiple asset classes. It starts with a risk-managed portfolio including close to 9,000 individual stocks globally diversified with no duplications. Since clients own almost the entire global stock markets, they are assured of earning the returns of that market. Some clients choose to allocate more or less to bonds as a risk-management tool in an effort to reduce price volatility. FWCG is very proud to say that our accredited investors are also able to diversify into alternative investments as both a risk-management tool as well as the great potential of higher earnings in what has proven to be an inefficient market.
We help our clients take advantage of the free returns in the publicly traded market, rather than trying to outsmart what has become an increasingly efficient market. An efficient market exists when a global list of professionals make worldwide trades by studying what amounts to a common set of information. We expect that in an efficient market, it is not prudent for our clients to expect any trader to consistently outperform other traders over a lifetime. The record in the market is that the greatest majority of all traders underperform a simple buy and hold of a risk-adjusted benchmark over the longest time frame.
Over the last 25 years, our clients have trusted our advice and have learned how easy it is to buy and hold the market using efficient, risk-managed portfolios created by the professionals at FWCG.
Best Time To Invest (1927 – 2014)
See how $1 invested in the U.S. Total Stock Market grew over the last nine decades, as well as what was in the headlines in Time Magazine. As the video shows, short-term news events generally had little impact on long-term market growth,