Investment Philosophy

The most unique difference in how we manage investments is that — WE ACTUALLY MANAGE INVESTMENTS, rather than outsource to a 3rd party whose idea of investing relies on a 70+ year old “Modern Portfolio Theory.” This is the same theory and philosophy used by big-box firms and the vast majority of financial advisors so that you’ll always do “just ok enough” compared to the broader markets so that you don’t take your assets elsewhere.

I think that is a selfish and a spineless way to manage client assets. When it comes to investment management and advisory services, ask me about "Alpha" and how it's possible to beat the benchmark while also reducing overall portfolio risk.

I believe in a sound financial plan, but let's be honest, investment returns are the single biggest driver of your ability to retire well.

We've come a long way since Modern Portfolio Theory in 1952 so it's time to hold asset managers accountable for underperformance, especially when a DIY investor can beat 80% of the industry professionals.

Keep reading below — I’m not afraid to share my strategies and fees openly because how we implement and manage is what makes Canopy Financial Solutions unique.

Portfolio Strategies & Risk Profiles

  • 1. Canopy Conservative Income Fund

    Who’s It For?

    Designed for conservative investors who require a fixed income that maintains pace with inflation but still has ability to appreciate and provide positive returns and Alpha against the US Aggregate Bond Index.

    What’s In It?

    Composed of carefully chosen bond funds, hedged equity funds, preferred and convertibles, and broadly diversified dividend funds

  • 2. Canopy Defensive Fund

    Who’s It For?

    Suitable for investors of all risk profiles (except the most conservative) as this is typically a temporary strategy with holdings that historically have performed well during market downturns and recessions. Despite being “defensive” in nature, this strategy is still expected to provide Alpha against the S&P 500.

    What’s In It?

    Composed of carefully chosen bond funds, hedged equity funds, sector equity funds, and global diversifiers

  • 3. Canopy Strategic Growth & Income Fund

    Who’s It For?

    Designed for moderate and moderately-aggressive investors with a preference towards value, dividend income and dividend growth. This strategy is also intended to provide positive returns and Alpha compared to the S&P 500.

    What’s In It?

    Composed of carefully chosen value and dividend aristocrat stocks, global dividend funds, sector diversifiers, and hedged equity funds.

  • 4. Canopy Growth Fund

    Who’s It For?

    This is our flagship growth fund designed for more aggressive investors with 5+ year investment horizon. Like many other strategies it implements our Dual Defense approach to own momentum leaders in bull markets and employ alternative bear market strategies during prolonged downturns. This combination approach lends to the high Alpha potential.

    What’s In It?

    Composed of carefully chosen individual stocks that have been identified as momentum leaders in their respective sectors; also includes other factors, themes and styles for broad based growth potential.

  • 5. Canopy Blue Horseshoe Fund

    Who’s It For?

    Expanding into even higher growth opportunities, this portfolio is designed for only ultra-aggressive investors with high risk tolerances who understand their investment could sustain catastrophic losses potentially exceeding 50% or more.

    What’s In It?

    Similar to the flagship Canopy Growth Fund, this portfolio implements a Dual Defense approach to identify the highest growth opportunities and trends using single stocks, 2-3x leveraged ETFs, thematic leaders and cryptocurrency funds. The Canopy Blue Horseshoe Fund has Alpha-Crushing potential.

  • 6. Canopy Nonqual Transition Fund

    Who’s It For?

    This is more of a process than an actual portfolio strategy, used for new clients transferring nonqualified (taxable) investment assets from another financial institution with an emphasis on tax sensitivity.

    What’s In It?

    The ultimate goal is to fully transition to one of the other 1-5 Canopy Funds after the client’s assets have transferred-in-kind and we are able to develop a proper trading and rebalancing strategy while taking cost basis and capital gains into consideration.

FAQs

  • 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.

  • 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.

  • 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.

  • 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.