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Investment Options

Investing for your future can be a positive experience. Our role is to guide you through a journey which begins at setting goals, and is always heading in the direction of your desired future. Getting to your destination will require a well-built path that has weathered many temporary obstacles. Once your goals are defined, and the most efficient paths are found, then you need appropriate vehicles to get you there.

Whatever investment option you choose to help get you to your destination, each one has an expected return that is based on both the straightforward common-sense relationship of risk and return, and on historical academic evidence that covers almost 100 years of data. Carr Wealth Management strongly believes that compounded growth - interest on interest, earnings on earnings, is the most powerful investment strategy in building wealth. However, high fees, higher taxes, and transaction-oriented strategies can prevent investors from experiencing the powerful effect of long-term growth.

Investment products offered through Carr Wealth Management, LLC are not insured by the FDIC or any other federal government agency, are not deposits or other obligations of, or guaranteed by, a bank or any bank affiliate, and are subject to investment risks, including possible loss of the principal amount invested.

Publicly Traded Investments

  We manage client investments that are traded exclusively on national exchanges (i.e., N.Y. Stock Exchange, American Stock Exchange, etc.). Stocks or bonds traded on public exchanges have the following benefits:

  • Liquidity-describes the degree to which an asset or security can be quickly bought or sold in the market without impacting the asset's price. Typically, a security that is sold on a public exchange requires approximately three days to settle. Private equity investments such as private real estate ventures, private stock ownership, hedge funds, or various business partnerships may require notice and additional time to liquidate (sell) holdings of the respective investment. We feel that for most investors, the risk of not having quick access to funds outweigh the potential expected returns of private equity investments.
  • Transparency - The investment strategies guiding the path to your financial objectives should be clear, distinct, and built around answering the who, what, where, and why. We believe long-term returns are based on the level of risk you accept, and properly managing risk requires a thorough understanding of each asset in your portfolio. The strict requirements to publicly register an investment and the rigid oversight of the markets requires investment transparency that is typically greater than that of private equity markets.
  • Diversification - A major benefit of engaging in publicly traded markets is the ability to achieve what is probably the most important requirement of a successful investing experience – Diversification! The act of combining different asset classes together does not assure investment success, but it certainly improves the chances of reducing total portfolio risk without sacrificing returns. Private equity investments, on the other hand, typically invest in assets that are narrower in scope (i.e., one company, real estate only, sectors, etc.).   


Investment Vehicles

Managed Funds (Mutual Funds) - Managed funds are pooled investments that contain dozens of different securities, so you lessen the risk of holding just a few individual stocks or bonds.

We have provided investment advisory services specializing in managing mainly mutual funds that provide the investor with several benefits including diversification, low-cost, tax-efficiency, and the opportunity to track benchmark returns instead of trying to outperform them(See "What is Passive Investment Management?")


Individual Securities

Owning individual stocks or bonds in taxable accounts (non-IRA, or non-qualified) can be an effective tax management tool. The ability to identify specific holdings and sell losses to lessen otherwise taxable profits are some of the strategies employed with managing individual securities. In addition, investors who have low basis stocks from long-term holding periods may have an incentive to keep the individual securities due to potential tax consequences. However, we believe holding individual securities also carries disadvantages for the investor, including:

  • Transaction-Oriented - Strategies to minimize taxes may involve excessive trading which involves greater transaction costs and potential capital gains (if gain position).

  • Inadequate Diversification - Holding individual stocks may not be adequately diversified as holding managed funds which can contain a variety of markets, sectors, and regions.

  • Ineffective Strategy - Buying or Selling Individual securities may lead to the ill-advised practice of "Chasing Yesterday's News!" - Buying securities following an increase in price or selling securities on price declines. What is essentially done is buying high and selling low - not a great recipe for a successful investment.


Which Investment Companies Will I Be Using?

There are over 9,500 mutual funds offered in the United States by approximately 80 mutual fund companies. Carr Wealth Management believes that achieving positive long-term investment results is better accomplished through low-cost investment vehicles that take advantage of market returns by essentially tracking various market sectors. Carr Wealth Management has predominantly  used investments from two companies over the past twenty years – Dimensional Fund Advisers (DFA) and Vanguard.

Both Dimensional Fund Advisors  and Vanguard share our investment philosophy of providing clients investment solutions based on academic research and a commitment to disciplined investing. Some of the major characteristics of the investments used by Carr Wealth Management:

  • Low-Costs
  • Liquid
  • Diversified
  • Transparent
  • Built to Capture Long-Term Appreciation

TD Ameritrade Institutional - Third Party Custodian

 The Third Party Custodian where client funds are held is the institutional division of TD Ameritrade, Inc. They neither offer proprietary products nor services to the general public. They make available to independent Registered Investment Advisors, like Carr Wealth Management, the necessary platform to provide independent advice that is legally required to be in the client's best interests. Their online access is user friendly and they support clients and advisers alike with state-of-the-art technology.

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