Kwajamii’s Investment Philosophy and Beliefs

August 15, 2019

Before considering or even thinking about investing, we, at Kwajamii, work closely with you to gain a deep and complete understanding of your unique circumstances, including your short-term and long-term goals. Once this required initial step is completed, we develop a customized and detailed financial plan to meet each of your stated objectives. We strongly believe that having a detailed plan provides multiple benefits. For instance, a plan will:

  • help you focus on the big picture (your goal);
  • allow you to make important financial decisions more easily; and
  • act as a benchmark when measuring progress towards your stated goals.

We believe a financial plan should be reviewed on a regular basis and updated promptly to reflect any changes in your circumstances. We have always viewed a financial plan as a flight plan. And like pilots, we are concerned about your safety, comfort and schedule. Once a plan is finalized, the next step is its implementation which, in most cases, requires your savings to be invested in financial markets. When it comes to investing, there are essentially two schools of thought: active investing and passive investing. Active investing attempts to deliver excess returns, net of fees, relative to a predefined benchmark, whereas passive investing – or smart investing as we prefer to call it – recognizes that it is not possible to outperform the market in the long run. Passive investing is founded on the following:

  • financial markets are broadly efficient which means that all known information about a particular security is already embedded in its market price and any new information will be reflected in its price very quickly. As a result, market efficiency makes it difficult – some may even say impossible – for any investor to consistently outsmart the rest of the investing public over time;
  • risk and returns are closely related. Risk is typically what drives returns although there is no guarantee. Generally, the greater the risk, the higher the expected rate of return;
  • it is extremely difficult to consistently and reliably predict which asset class is going to outperform in any given year. And so, facing uncertainty, the best approach is to build a well-diversified portfolio. Diversification not only reduces overall risk, but it also tends to enhance long-term returns;
  • investment costs and other charges, when compounded over time, can significantly impact the value of your investments. All else being equal, the lower the investment cost, the higher the long-term return net of fees. In any case, it always comes down to the overall value you receive as an investor versus the fees you pay;
  • it is near impossible to consistently and reliably time financial markets. You are better off investing for the long-term. Investing requires to accept short-term market volatility. Be aware of common behavioural biases. Stay the course and remain invested when experiencing a market correction. The best action is usually to do nothing unless there was a material change in your circumstances.

We believe, investors are better served in the long run by adopting a passive approach to investing. Contact us at and learn more about how we can help you achieve your dreams.


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