Investment Process

Interview, contract and account set-up :
This first interview allows prospective clients to determine whether or not they feel comfortable with our management style. If the Client decides to engage our services, he or she signs a contract that details our mutual responsibilities. At the same time, the Client has to establish an account with a custodian. Universe, Inc. does not act as a broker or as a custodian of assets, but utilizes the services of reputable brokerage firms and banks for those services. We work with the client’s existing brokerage account and are authorized by the client to make investments on their behalf. If a client does not have a brokerage account at this time we help to open one. Our first meeting allows us to understand the Client, and his or her needs and preferences.

The following are the factors that we take into consideration in managing each portfolio:

  • Risk tolerance of investor
  • Size of financial assets to be invested
  • Understanding the cash needs of the investor
  • Time horizon of investments
  • Age
  • Extent of other financial assets as well as non-financial holdings
  • Level of income
  • Stability of income
  • Tax status of the investor and tax implications of investments.

Asset Allocation :
The second step in our investment process is Asset Allocation. Based on investor’s characteristics we determine the right mix for the portfolio among asset classes (stocks, bonds, real assets) as well as among countries (US and foreign). In determining the mix, we draw on the lessons of diversification; asset classes tend to be influenced differently by macroeconomic events. This, it turn, implies that diversifying across asset classes will yield better tradeoffs between risk and return than investing in any one risk class. The same can be said about expanding portfolios to include both domestic and foreign assets.

Security Selection :
The third step in our investment process is Security Selection. We use active and passive security selection (indexing strategy). Our investment choice based on fundamental analysis as well as comparable analysis.

Execution :
Our execution style of the investment process is based on minimizing trading as well as its cost. We try to make trading costs as low as possible and execute our trades through brokers who are the most cost efficient.

Performance Evaluation :
The last, but not the least important, step in our investment process is performance evaluation. Our evaluation is based on comparison of results from of our clients with comparable benchmarks based on after tax return and risk.