FAQs: Investment Style & Philosophy

  • Alpha is a risk-adjusted measure of a portfolio or investment’s return compared to a relevant benchmark like the S&P 500 or the US Aggregate Bond Index.

    This is important because it shows how your investment manager has performed historically against the market so you can make an informed decision about whether it justifies fees being charged.

    Canopy Financial Solutions is intently Alpha-focused and uses unique strategies based on momentum and risk mitigation that has historically produced well above average Alpha, especially over longer periods of time.

    Keep in mind that people choose financial professionals for a variety of reasons and goals. Investment performance is certainly important; however, each person needs to decide whether they are receiving appropriate value and service from their financial professional.

  • Nothing, except for the fact that it relies on premises that are debatable like the Efficient Markets Hypothesis.

    The MPT method of managing portfolio risk is through broad diversification of asset classes so that if one area of your portfolio is sustaining losses, the owning of multiple other classes will likely offset massive declines in value. Proponents of MPT constantly tell you that you have to “ride out the down years” because it’s impossible to know where market tops and bottoms are.

    If you own enough of the entire market itself then you will never drastically underperform a benchmark — but also never have the opportunity to match or overperform. And all of that of course is before fees and expenses come into play.

  • Significantly.

    I still believe in diversification of assets but not OVER-diversification like seen in most cookie-cutter model portfolios.

    We use a Dual Defense (DD) approach thanks to special technical analysis software from SumGrowth Strategies, LLC and AlphaDroid technologies.

    Quite simply, we mitigate risk by seeking to own only the trend leader of a candidate basket of investments during bull markets, and then mitigating downside losses by employing Bear Market Strategies when our StormGuard-Armor indicates an onsetting bear market or “black swan” catastrophic event.

  • Altruist Financial, LLC is our primary asset custodian and investor platform. Altruist boast a modern, yet simple client interface and is designed to support the needs of independent RIAs like Canopy Financial Solutions.

    Clients who onboard through Altruist will immediately notice the smooth digital account opening experience that literally takes just minutes to establish.

    Altruist also offers a separate high-yield cash account that is a great place for clients to partition and safely grow emergency funds or short-term idle cash — a key component of your PROTECT asset bucket.

 FAQs: Fees & Fee Structure

  • Because of the wide-ranging types of financial services, industry professionals make their money differently — sometimes it’s dictated by the agency or firm, sometimes by personal preference, sometimes by credentials and licensing, and of course sometimes by profit potential.

    A fee-only advisor is a financial professional or firm that provides financial planning, investment advice, asset management, or other consulting services and is compensated solely by the client.

    Examples include providing advice or consulting at an hourly rate, financial planning deliverables for a flat or recurring fee, or portfolio management services where the fee is based on a client’s total account value (assets under management).

    Canopy Financial Solutions does not receive commissions or incentives from trading or selling financial products such as mutual funds, insurance, or annuities.

    This means my interests are aligned with yours and not influenced by a third party or commission structure.

  • My primary role and value I bring to clients is through investment management. Please see the Investments Strategies page to learn more about my investment philosophy, process and fee details.

    Investment clients pay a simple 1% annual fee based on Assets Under Management (AUM).

    I provide regular communication when needed and we address basic and common concerns during semi-annual Client Checkpoint Reviews.

    If you are already a client and desire more pointed advice and specific planning needs that require analysis, forecasting, or professional research, I will quote a flat fee based on what it will take to satisfy your need and deliver relevant materials.

    For comprehensive financial planning, modeling, and forecasting: $250 per hour, which includes advice, plan preparation, plan delivery and presentation with client.

    For consulting services where a client does not require a detailed deliverable but just professional advice and recommendations:$200 per hour.

    *I will always discuss fee options and make sure we agree on the best path forward before officially engaging.

  • Easy now, one question at a time.

    1) As a fee-only RIA, Canopy Financial Solutions does not make any commissions or transaction fees from trading, therefore, any changes to portfolio holdings are to capitalize on momentum opportunities and not an attempt to “churn.”

    2) True, in a nonqualified (taxable) investment account, capital gains to lend to potentially higher taxes depending on your OVERALL tax situation and filing status. Capital gains are the result of successful investing. While active management may result in complete shifts in and out of bull/bear strategies, the intent is that the extra ROI (or Alpha) offsets taxes on the upside, and “taking profits” to avoid bear market losses preserves account value to a much greater extent than your tax obligation.

    3) Lastly, in nonqualified (taxable) accounts, I replicate core investment holdings with an ETF that replicates the active Dual Defense rotation strategy that is successfully employed in qualified account strategies, which reduces the effects of trading out individual positions.

  • Actually no.

    My commitment to simplifying wealth management is most evident in our fee structures.

    I charge a flat 1% annual fee for Assets Under Management (AUM). This means that my fee depends on your account value and my ability (and incentive) to grow that amount.

    The 1% annual fee is broken down into a monthly charge (0.0833% of AUM)) that is clearly shown on your client invoice each month. This fee is automatically deducted from your investment account balance so there is no action necessary on your part.

    Since many of our portfolios use individual stocks and almost never include mutual funds, the expense ratios are significantly less than the average model portfolio.

 FAQs: Protection & Planning

  • No, I am not a lawyer, nor do I offer legal advice or draft legal documents.

    As a Chartered Financial Consultant (ChFC), my advanced studies and case work extends beyond traditional financial representative roles and knowledge.

    Additionally, I have a fully disclosed role (OBA) as a consultant for Brick City Law, a business and estate planning law firm in Sanford, NC.

    Also, proud to disclose that my wife, Jessica, is the founder and the attorney that I trust most to provide expert legal solutions to my clients.

  • Everyone has a unique situation that lends to different advice and solutions along the way; however, here’s some examples:

    Protect Your Property

    • Home, auto, and umbrella insurance

    • Business liability and overhead (if applicable)

    Protect Your Income

    • Establishing a Bucket Strategy and savings plan

    • Emergency fund with guaranteed growth and protection

    • Disability income insurance

    Protect Your Family

    • Life insurance (term, universal / IUL, whole, variable)

    Protect Your Dignity

    • Long term care insurance

    Protect Your Health

    • Health / medical insurance

    • HSAs / FSAs

    • Medicare

  • It is true that most group benefit plans do include many of the insurance coverages listed above.

    It’s important to recognize that your “group” coverages are valid only for as long as you are a member of that group. That means if you lose or change employment, you lose that coverage - your protection portfolio is highly exposed to risk along with your family.

    Group benefit options often have coverage limits that may not provide adequate protection for your specific needs.

    While group benefits are certainly great, they are not customized for any particular person so it is wise to do a complete review or Needs Analysis to identify coverage gaps and create a more enduring protection portfolio.

  • I believe it’s necessary to have different “buckets” of money to accomplish different goals.

    I’ll try to explain by differentiating between SAVINGS and INVESTING.

    Savings means the money you defer or set aside on a recurring basis for certain goals like retirement, emergency fund, college savings, vacation fund, or planned major purchases. It should occur naturally and automatically with a “pay yourself first” mindset.

    Investing involves working with me to determine your objectives, risk profile, and time horizon, and then allocating your savings into a portfolio or investment strategy.

    A Bucket Strategy helps break down these investment objectives into more appropriate risk/return strategies depending on whether the goal is NOW, SOON or LATER.

  • When you have a real life emergency, the last thing you need is more uncertainty.

    Your emergency funds should reside in a high yield savings or money-market account where it is safe (FDIC insured) and liquid - able to be converted to cash and typically accessible within 24-48 hours.

    All Canopy Financial Solutions investment clients have access to Altruist Cash, a high yield savings account (currently 4%) offered through my chosen asset custodian, and there are zero costs or fees involved.