Freestate Advisors

How We Manage Money

For more than sixteen years investors have experienced periods of portfolio gains followed by periods of large losses – and ended with little growth in their total wealth. We have developed a simple but powerful approach to investing in these conditions.

 

The goal of our investment strategy is to capture market gains when investment conditions are favorable, and protect against large losses when investment conditions are unfavorable.  Making money during the good times is important, but protecting your portfolio during bad times is just as important.

compass-iconThree Step Approach

Our investment approach follows three basic steps:

 

STEP 1

Understand current investment conditions. Are conditions favorable or unfavorable?

 

STEP 2

Invest in assets that benefit from those conditions

 

STEP 3

Change portfolio investments when conditions change

 

Investment conditions are favorable when the economy is expanding and corporate profits are growing.  When conditions are favorable, we invest in a broadly diversified portfolio of growth assets, primarily high quality stocks and other securities.  Growth assets have historically produced strong gains when economic conditions are favorable.

 

Investment conditions are unfavorable when economic growth slows, corporate profits shrink, and market momentum turns negative.  Investors suffer large losses when unfavorable conditions turn into a full-blown recession.

 

When conditions are unfavorable, our portfolio becomes defensive.  Growth assets are replaced with safety assets.  During recessions, the only assets that usually prosper are high quality government bonds.

clipboard-iconResearch and Discipline

A disciplined, research-driven approach to investment strategy is the hallmark of Freestate Advisors.  We have developed a consistent process to:

  • Investigate promising investment discoveries from published research.
  • Thoroughly test and extend the original research.
  • Shape the best and most important insights into a superior framework and discipline for investing.

 

We don’t pretend to predict the future – that is impossible.  Instead, our data-driven approach tracks investment and economic conditions, and client portfolios are changed when there is a change in conditions.  Ordinarily these changes are not frequent.  But we track investment conditions continuously, and when changes occur they are important.

 

trophy-iconWinning By Not Losing

No investment strategy wins all the time.  Volatility and periodic losses are facts of life in financial markets.  However we believe clients benefit from our constant attention to investment conditions and portfolio risk.  Because we rigorously follow our investment discipline, clients know what to expect from us.