$2 Billion UBS Wealth Management Team Says A 60/40 Portfolio Is Best

Group Title: Rimmel Mehaffey Pessy Wealth Consulting Group

Agency: UBS Wealth Administration

Senior Members: James W. Rimmel, Daniel J. Pessy

Location: Pittsburgh, PA

Group Custodied Belongings: $2 billion

Forbes Rankings: High Wealth Administration Groups Excessive Web Value, Finest-In-State Wealth Administration Groups

Background: Each Pittsburgh natives, James Rimmel and Daniel Pessy have been at UBS for over 20 years. Rimmel joined Paine Webber in 1997 (which UBS acquired) and finally teamed up along with his spouse and his father-in-law, who every had their very own separate companies. Pessy began out working for Rimmel and was a part of the staff when it was formally shaped in 2003. With 9 folks altogether now, the staff sometimes works with excessive web value shoppers in addition to establishments like endowments or nonprofits. Amongst their shoppers, many are enterprise house owners but additionally there’s a giant quantity in skilled companies: The agency has nearly 50 docs as shoppers, for instance.

Aggressive Edge: “We really consider that we make a distinction within the lives of our shoppers and have constructed our enterprise on that philosophy,” says Rimmel. “We’re very course of pushed early on so far as how we work with our shoppers.” Each senior companions additionally place emphasis on multigenerational planning and ensuring households are having the appropriate conversations about their long-term wealth. “We often have 4 energetic generations of shoppers in a household—from grandparents to great-grandchildren,” says Pessy. “Purchasers are so happy that we’re prepared to sit down down with the youthful generations.”

Funding Philosophy/Technique: “Our elementary ideas from an funding standpoint are all about asset allocation and diversification,” says Pessy. The staff locations an emphasis on tax-loss harvesting whereas additionally sticking to a bucketing technique that features silos for liquidity and longevity. From an fairness perspective, they describe themselves as long-term traders by nature, with publicity sometimes to a mix of large-cap progress and worth shares. “For the primary time shortly, the outlook for mounted revenue is de facto constructive,” notes Rimmel. “The 60/40 portfolio mannequin is now beginning to make sense to me for the primary time in ten, fifteen years.” Whereas nonetheless centered on shorter time period bonds, the staff has slowly been including period and is now seeking to construct out an intermediate sort bond portfolio. “I like bonds greater than equities,” says Pessy. “With charges being the place they’re and sure staying on this vary for a time period, bonds are beginning to turn into a extra enticing funding, particularly when trying on the volatility within the fairness market.”

Funding Outlook: “Our expectation over the subsequent 9 to 12 months is that volatility will proceed and in the end the market will commerce in a sideways trend,” predicts Pessy. “There’s nonetheless lots of uncertainty with what the Fed will do with charges—increased for longer is actually the theme, however will they stick with that?” With the added uncertainty of an election 12 months, will probably be that rather more essential to assist shoppers tune out the noise and remind them that their portfolio is constructed to climate volatility, the companions say. “Charges will keep increased for longer,” Rimmel predicts, including, “The fact is that charges at 6% or 7% could be the brand new regular.”

Finest Recommendation: The companions’ recommendation is twofold. “I at all times say to shoppers don’t watch the market day-after-day otherwise you’ll drive your self loopy,” says Pessy. “We’re on this for the long run and markets are usually not one thing you need to be fearful about day in and time out.” The opposite piece of recommendation has to do with multigenerational planning. “Now we have shoppers which might be getting previous; I actually attempt to encourage them to speak with their youngsters and convey them into their monetary planning in the event that they haven’t already,” says Rimmel. “It’s essential for us to encourage these conversations—get your loved ones concerned to assist by means of the method as you age.”