Welcome to M.I.N.D. Risk Management
Contact Us
3 Critical Mistakes
If you suffer from concentration risk, you have too much money invested in a single company, asset class or type. Most financial planners talk about risk reduction and diversification but the fact is that their horizontal diversification approach does not significantly reduce portfolio risk. Horizontal diversification is adding asset classes to the same asset type, such as combining large cap stocks with small cap stocks. Vertical diversification is adding different asset types, such as adding bonds to a portfolio of stocks. Vertical diversification is better than horizontal, but most portfolios need broad-based vertical diversification. Additional asset types are needed to properly balance the portfolio.

Most financial planners talk about risk reduction and diversification, but the fact is they continue to offer only stocks and bonds. It’s important to focus primarily on managing risk while achieving acceptable returns.

The M.I.N.D.© Risk Management System takes a more diversified approach to manage wealth by following a common sense discipline that incorporates basic, sound, time tested principles. The M.I.N.D.© Risk Management System starts with a macro approach to diversify a portfolio into five asset types that are not highly correlated. No more than 35% should be allocated into any one asset type to avoid concentration risk. This proprietary approach will diversify your portfolio within each asset type which helps to reduce risk. The objective is to establish a properly diversified portfolio that is part of the overall wealth management solution.