In Perspectives

As much as we hear talk of the “new normal” from prominent investment personalities, we believe that it’s just another version of that fateful proclamation heard just before the tech bubble burst in the late 90s – “it’s different this time”.  The fact of the matter is that the same fundamental principles that have governed prudent investing over the long run are just as important today as ever.  Perhaps even more so.

Sure, conditions change, and adapting to change is a core competency of good investment management but, that said, there are some fundamental truths that we hold dear. These are, in no particular order:

  1. If someone says they can time the market, walk away.  It’s been said that “The Hall of Fame of market timers is an empty room”.
  2. Adequate diversification is essential to controlling risk.  Many eggs and many baskets. It’s fun to talk about our winners but rarely do we discuss our losers. Think WorldCom and Enron.
  3. Working with an investment manager to build a solid portfolio is like dining at a fine restaurant. The quality of the chef and the ingredients matter.  A good investment manager utilizes research, experience, and instinct to identify probable winners and losers and achieve superior returns.  Seek out an advisor with a well-articulated, proven investment process.
  4. How your funds are allocated among growth and income investments is the most critical determinant of long-term success.  Get it right and you will be successful over time.  Get it wrong…
  5. Nothing is risk-free. The interest in your FDIC insured savings account is losing money after taxes and inflation. In fact, loss of purchasing power over one’s lifetime is far more damaging to one’s financial security than a short-term decline in the stock market.
  6. Yes, stock prices can be volatile. But in a period of rising interest rates even the “safest” U.S. government bonds can lose significant value. When you see a well-known celebrity pitching an investment product, walk away. They look good on camera and can read from a script but don’t have a clue of the risks involved, or worse… don’t care.
  7. Buying when markets are high on a wave of euphoria or selling when they are severely depressed is the typical behavior of an inexperienced or undisciplined investor. Taking the contrarian view and going against the herd takes courage, discipline and vision and is nearly always the better course of action.  Think Buffett.
  8. Ignore the noise and talking heads. Many commentators capture the spotlight because of their extreme views and likely have an agenda that conflicts with yours.  Emotional decision making will lead to ruin.
  9. Pick your investment advisor carefully.  Check credentials, get references, and ask if audits and regulatory exams are regularly conducted. Don’t accept bold promises on faith.  If it sounds too good to be true… think Madoff.
  10. When investing in stocks for growth, time is your friend.  Conservative savers will often equate the stock market to gambling.  At the casino, the longer you play, the greater the probability that you will lose all of your money.  With a well-diversified and disciplined investment plan, the longer you “play”, the greater the odds that you will “win” and achieve your goals.
Legacy Trust and Your Right to Financial Privacy

At Legacy Trust we have established policies and practices that respect the financial privacy of all individuals who use our trust company. We believe it is critical to comply with the laws and regulations designed to secure your financial privacy. Your relationship with us as our client is very important to us, and we want you to understand our policies and practices about handling your information.

This Policy applies to you – This Policy applies to our relationships with individual clients who inquire about or obtain products or services from us for personal, family and household purposes.

Strict security measures – We take the security of information very seriously. We have established security standards and procedures to prevent access to client information. We maintain physical, electronic and procedural safeguards to guard client information.

Limited employee access – We have established procedures to limit employee access to information to only those employees with a business reason for accessing such information. We educate our employees about the importance of confidentiality and client privacy. We take appropriate disciplinary measures to enforce employee responsibilities regarding client information.

Why we collect information – We collect information about you to:

  • accurately identify you;
  • protect and administer your records, accounts and funds;
  • help us design or improve our products and services;
  • understand your financial needs;
  • save you time when you apply for new products and services; offer you quality products and services; and comply with certain laws and regulations;

We collect information – We collect and maintain your personal information so that we can provide investment management and other services to you. The types and categories of information that we collect and maintain about you include:

  • Information we receive from you to open an account or provide investment advice or other services to you (such as your home address, social security number, telephone, financial information and investment objectives).
  • Information that we generate to service your account or from our transactions with you (such as account statements and other financial information).
  • Information on your transactions with nonaffiliated third parties.

We have established procedures so that the financial information we collect is accurate, current and complete. We are committed to work with you to promptly correct any inaccurate information.

Our selective sharing of information – In order for us to provide investment management and other services to you, we do disclose your personal information in very limited instances, which include:

  • Disclosures to nonaffiliated companies as permitted by law, including those who help us service your account (such as providing account information to brokers and custodians).
  • Other limited disclosures as permitted by law, for example, required reports to government entities.

We do not share your information with third parties for marketing purposes. We do not sell your information.

Former clients – If you end your relationship with us, we will continue to adhere to the privacy policies and practices described in this notice.

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USA PATRIOT Act

Important Information About Procedures For Opening A New Account

To help the government fight the funding of terrorism and money laundering activities, Federal law requires all financial institutions to obtain, verify and record information that identifies each person who opens an account.

What this means for you: When you open an account, we will ask for your name, address, date of birth and other information that will allow us to identify you. We may also ask to see your driver’s license or other identifying documents.

We apologize for any inconvenience this may cause; however, federal law prohibits us from waiving these requirements.

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