Investment Process

The WHM Group believes that the key to successful investing is eliminating the negative influence that human emotion can play, and implementing a disciplined, rules-based investment process. Unfortunately for most that is easier said than done. By following our investment process, we believe that we have the potential to generate both absolute and relative returns over time that allow our clients to reach their personal and professional goals.

Key Tenets

When we developed our process, we identified four key attributes that had to be addressed within the process.

  1. Risk: Our group defines risk as the permanent loss of capital. Risk management in a portfolio is of utmost importance. Why? Because most of our clients have a finite time horizon for their investments and may need their money at any point in time. Our process also must have the ability to adapt to our individual client’s unique risk tolerance. Despite what the pundits would have you believe, risk tolerance is not necessarily directly related to one’s age, but is based on our unique life experiences, financial situations, personal commitments, and perspectives. Our process attempts to mitigate risk in three ways:

    a. Proper diversification
    b. Buying good companies at attractive prices
    c. Using supply and demand to position portfolios on offense or defense

  2. Transparency: It is paramount to our team that at all times our clients understand why they are invested the way that they are. Not only do we want our clients to know what they own, but why they own it, how much it costs to own it, and their exposure to risk. We designed our process to be built on basic economic principles that are easy to explain and understand.

  3. Discipline: Whether your personal or professional goals include losing weight, growing your business, being a better spouse or parent, or being a great investor, a key determinate of your success will be your discipline to staying on the path to achieve your goal. Our investment process must be well-defined and time-honored, and one in which we believe will achieve our client’s goals over entire market cycles. Such a process enables us to be disciplined about sticking with it.

  4. Unemotional: The markets are constantly evolving which leads to many opinions from strategists on what may or may not happen with the economy and markets. We are all inundated with information overload, which can be overwhelming. Some individuals react to information overload by constantly chasing whatever is being touted as the next sure thing, constantly second guessing themselves and those they have entrusted. Others react to the other extreme by shutting down. Our investment process must be based on facts and what we know, not by opinion and conjecture. It cannot be swayed by emotion. By having a process, and being disciplined followers of our process, we strive to eliminate our emotion from investment decisions.

Our Strategic Approach 

Our process is simple and straight-forward. We do not forecast where we think things may go. We look at the current facts, weigh this evidence and position portfolios accordingly. We are tactical in nature. As the evidence changes, our portfolios change. We review the data and follow the process outlined strategically.

  1. Risk Positioning: We first review the technical market data and assess the current risk environment. Based on the data, we determine if we should be positioned for offense, seeking additional growth, or positioned for defense, with a greater focus on the preservation of capital.

  2. Determine What to Buy: We leverage the depth and experience of the Wells Fargo Investment Institute’s team of over 120 investment strategists and analysts to comb the thousands of stocks available for investment. Through rigorous qualitative and quantitative research, this team builds a list of favorite ideas in different styles, sectors, capitalizations and geographies. We believe that the market is inefficient and investor’s short-term emotions can create opportunities to purchase securities for the long term at prices below their intrinsic/business value. Through the use of a quantitative research process, we believe we can exploit these opportunities.

  3. Determine When to Buy and Sell: We use a form of technical analysis known as relative strength which is based on the principle of supply and demand. We want to position assets in areas of strength (more buyers than sellers) and work to avoid areas of weakness (more sellers than buyers). Our team reviews the supply and demand relationship of each stock from the universe we are considering and ranks those stocks. The goal is to ultimately own a basket of stocks that possess more price momentum than the other stocks within the universe. A process that only addresses what to buy is only half complete, so the other key aspect is having a disciplined approach to identify when to sell. 

    We also leverage supply and demand analysis to determine when to have exposure to certain asset classes other than individual stocks. We rank the six major asset classes (domestic stocks, international stocks, bonds, commodities, currencies, and cash) from strongest to weakest. We strategically review this ranking and position portfolios in the top ranked asset classes. Yes, we do view cash as an asset class--especially during times that call for a defensive posture.

  4. Review on a Scheduled Basis
Investing is not a sprint, but a marathon which can be significantly impaired because of human emotion. The WHM Group believes that we are able to maximize our clients’ investment success by using our disciplined, unemotional, rules-based investment approach.


The PIM program is not designed for excessively traded or inactive accounts, and may not be appropriate for all investors. Please carefully review the Wells Fargo Advisors advisory disclosure document for a full description of our services. The minimum account size for this program is $50,000.

Since no one investment program is appropriate for all types of investors, this information is provided for informational purposes only.  We need to review your investment objectives, risk tolerance and liquidity needs before we introduce appropriate investment programs to you.