Jay Brammer is the Chairman & Chief Investment Officer of Indie Asset Partners and I have had the pleasure of working with him for the past year and a half. He has been investing in traditional and alternative investments for over 35 years. During that time, Jay has accumulated extensive business experience including, but not limited to the following:
• Ownership of Gibraltar Remembrance Services, LLC, the largest privately-held cemetery and funeral home business in the country, employing approximately 1,500 people. Most notable among Gibraltar’s managed properties is the beautiful Crown Hill Cemetery in Indianapolis, which hosts a U.S. National Cemetery;
• Owned and operated a real estate company, with over 2,400 apartment units and 600,000 square feet of office space;
• Owned and operated a medical billing business with over 100 employees.
I thought I’d share with you his responses to two questions regarding the topic of alternative investments which is the cornerstone of his expertise in successfully navigating varying markets.
1) Why do you invest in alternatives?
2) Why, as a part of a diversified portfolio, should clients invest in alternative asset classes given today’s market environment? Jay Brammer, Chairman & Chief Investment Officer
“First, I define alternatives as any asset that doesn’t trade on the exchanges. I invest in alternatives, primarily, to add assets that don’t depend on markets for returns. Returns for many alternatives are based more on the talent of the managers and their ability to find opportunities. However, some alternatives are geared towards income. These are meant to generate higher income than traditional sources given the risk level being taken. Some of these income sources provide tax deferment or tax advantages.
In a world with high asset values and rising interest rates, it is important to invest a portion of assets that will react differently if rising rates either eventually cause asset values to fall or the economy to falter. If all assets perform relative to performance of stocks and bonds then portfolios will decline in sync with these markets.
Many people try to take this risk out with cash or short-term bonds, but these instruments yield very little. Adding alternatives can diversify a portfolio with approaches that aren’t dependent on stocks and bonds and therefore lower the volatility of portfolios. Importantly, it can do this with better returns than cash and short-term bonds.
I also sat down with Grady Gaynor, President & CEO of Indie Asset Partners, LLC and asked him the same questions. I also asked him to comment on how our traditional-market technical work is woven into formulating our view. Grady Gaynor, President & CEO
“I recommend investing in alternatives to bring down risk within an overall portfolio. Many clients save enough or have enough assets to achieve their family goals; their risk is in losing their capital to overweighting traditional assets, specifically stocks. In the last 20 years, many investors have made mistakes at the peaks and valleys of market swings. By using alternatives I am looking to take out as much volatility as possible to clients’ range of returns.
Technical work suggests we are at another peak in the US Stock Market. Cash is generally not considered a way to manage wealth, especially at today’s low-interest rate environment. With equity valuations at historic highs, some alternative forms of investing can provide better risk and reward scenarios.”
A properly diversified net worth structure is not over-concentrated in traditional stocks or bonds, mutual funds or ETF’s, real estate, traditional or alternative asset classes. It is, however, tactically weighted across multiple asset classes. The valuation styles may consist of both relative value and absolute return as Jay and Grady point out. The careful construction of an investment portfolio or net worth is crucial to the success of the overall financial plan.
Indie Asset Partners has the right people, experience, vision, information, and execution to capitalize on market opportunities. The alternative asset class has its complexities and yet it is an asset class that is growing faster than any other due to the stock and bond market in which we find ourselves.
To learn more about how Indie Asset Partners can help you “consider the alternative”, to have our team complete a complementary portfolio review, or if you simply have questions about the markets, please reach out to us. We’d be happy to speak with you.
Please note that past performance is not an indication of future results. Alternative investments are offered to individuals with a net worth of $1 million or more, and are not always available for immediate liquidation.