Our Philosophy on Investing


Asset Allocation
The asset allocation decision has a greater impact on future performance than any other investment decision.  The key to investment strategy is to properly allocate assets between three major asset classes: cash, bonds, equities.   Identifying the proper asset allocation depends on such things as each client’s financial goal, risk tolerance, need for income, and individual inflation rate.

Within the three broad asset classes are various subcategories that may also present shorter-term opportunities for investors.   We constantly monitor market conditions and under- or over-weight categories when we believe we can improve returns or protect capital.

Manager Selection
Summit selects mutual funds managed by some of the most successful investment managers in the world.   Using our databases and analytical tools, we select funds that consistently excel in their style of investing.  We not only consider in-depth due diligence about each fund, but test how each fund complements the other funds in the investment portfolio.  For high net worth clients, this analysis may also extend to separate accounts and hedge funds of funds that operate as limited partnerships.

All mutual funds used by Summit Asset Management are no-load funds.   There are no sales charges or commissions.   Our clients are the only ones who pay us.   We select funds with low management fees compared to their investment performance and who have an attitude of looking out for shareholder interests.

Performance Monitoring
We regularly monitor the performance of each fund and each portfolio.   We compare the performance with appropriate benchmarks and with other funds and portfolios with comparable objectives.   Manager changes are sometimes required when we believe a development at the fund could prevent it from achieving expected long-term performance.

Control Investment Costs
A discussion of the costs of investing is important, primarily because investment performance is hard enough to accomplish without the encumbrance of unnecessary layers of fees.  The impact of some fees is not obviously apparent.

The costs of investing with Summit occur at three levels: our fee as investment advisor, the management and transaction fees incurred by the mutual funds, and the fees charged by the custodian.

Our fees are stated in annual percents and charged quarterly based on the amount of assets under management for each family.   Our management fee schedule is published in our Investment Advisory Agreement and our SEC Form ADV disclosure.   Annual fees begin at 1% for our minimum $100,000 portfolio. The lowest marginal rate charged to the largest balances (over $3 million) is .25% per year.

High fees and mediocre investment skills cause a large number of mutual funds to under-perform. Summit only invests in no-load mutual funds.  That means they charge no sales commissions or loads to reduce returns or tie up your investment for several years.  However, even no-load mutual funds subtract management fees from the investment returns they achieve.   That’s why we spend so much time researching to find the best fund managers who deliver more value than they charge in fees.  We also pay attention to the turnover ratio of funds to avoid excessive transaction costs.