A thorough investigation, often referred to as due diligence, is critical in the evaluation of alternative investments. Every investment should be reviewed for fees, performance, and sound operations. However, the bar for evaluating alternative investments is much higher for us.
Why on-site is important
For example, on-site due diligence visits are vital in the evaluation of alternative investments. It goes far beyond what many investors do since it is time-consuming and expensive. For example, in the visit to a potential investment referenced in the video involved 3 people on the team. Six ears to listen and pick up nuances that many never take the opportunity to understand.
As referenced in the video, the nuances can be a reason to stop the process and move on to other ideas. There are multiple, opportunities for investment. White Oaks casts a wide net to expose many potential opportunities to select from. We expose ourselves to ideas by:
- Use research databases to screen thousand of opportunities into a short list for evaluation.
- Attend conferences designed to expose unique investment opportunities. In a previous post, I referenced the notion of “kissing frogs”. Out of screens of thousands of managers, we may select just one.
- Since White Oaks serves high net worth clients we receive requests for an introduction to new opportunities on a daily basis.
Contrary to how many funds operate all this is done at White Oaks expense and NOT charged to the fund directly in addition to our management fee. This is a huge cost saving for investors using similar strategies.
The evaluation of alternative investments requires significant time and expense. Yet, even that is not enough. Collaborative teamwork by the financial advisory team, when combined with years, of experience, serves to improve the probability of success.
Experience, collaboration, a sound process combined with the understanding gained by on-site due diligence visits improve the end result when evaluating alternative investments.
Robert Klosterman, CFP® is Founder of White Oaks Wealth Advisors, Inc., a fee-only wealth management firm, and its predecessor R.J. Klosterman & Co, Inc. Bob has been a Certified Financial Planner licensee since 1989. He has a clear vision for the future having worked in financial planning since 1975, and feels a strong need to provide people with expert and independent wealth advisory services. As a Certified Financial Planner and certificate holder for Family Wealth Advising, Bob’s expertise and guidance have helped to fuel the steady growth of the firm. Today, White Oaks Wealth Advisors boasts a talented staff of advisory professionals, hand-picked for their financial planning and wealth management knowledge as well as their dedication to client service.