Portfolio Rebalancing

Greetings Clients and Friends:

Our allocation committee has been busy over the last few months, and we finalized a few portfolio changes at yesterday’s meeting. We placed trades in many of your non-taxable accounts today; we will move more slowly through your taxable accounts to manage tax costs.

 Summary:

 We made three changes to fine-tune our positions:

1)    We sold the international minimum volatility fund;

2)    We replaced the short-term corporate bond fund;

3)    We replaced the Doubleline Total Return Tactical bond fund in larger accounts.

 More Details:

 As the global outlook remains bright, we have found the need for the extra protection from our international minimum volatility fund (EFAV) to be less compelling. The shift from our short-term corporate bond fund (SPSB) to floating rate bank loans (FFRHX or SRLN) will protect us from rising interest rates and provide more upside potential if the markets continue to thrive. We replaced our Doubleline Total Return Tactical bond fund (TOTL) with…the Doubleline Total Return Bond Fund (DBLTX). This latter fund has a higher concentration of mortgage-backed bonds which provides greater diversification and has a built-in duration management tool since homeowners generally refinance when interest rates fall.

So far this year our portfolios have provided returns in the high single digits and are outperforming our simple benchmark. We are pleased with our balancing act between growth and safety. We remain optimistic about continued global growth, although we are paying close attention to the threat of sustained inflation. As always, our best defense is to anticipate cash needs and set aside funds accordingly; please keep up updated as your situation changes.

 Don’t hesitate to contact us if you have questions about your portfolios or our trades.

 Sincerely,

 John Biebel, Chief Client Advisor

Stephen Bobo, Chief Allocation Strategist

Tamara Kowalczyk, Planning and Investment Strategist