ICM Frequently Asked Questions:

What can I expect from Investor’s Capital Management, LLC?

Plans that suit your needs
Every situation is different and ICM has a plan that matches your situation. For those with significant assets desiring someone else to handle all the details of day-to-day monitoring and investing of your portfolio, a Managed Account is suggested. For investors who wish to retain the tasks of security selection, record keeping, and performance monitoring, we suggest our Cookbook Plan.

Financial planning
While investments are certainly an important area (and our particular area of expertise), together we review many issues other than investments. Examples are tax planning, retirement planning, living trusts, estate planning, gifting, charitable giving, mortgage financing, funding a child’s IRA, Roth IRA conversions, IRA distributions, and tax-deferred saving for college expenses.

Sometimes we use outside professionals to prepare specific documents (e.g., a trust attorney). ICM maintains a list of professionals for your reference and together we review any documentation prepared by others to make sure it fits your specific financial circumstance.

Fee-only Compensation
It’s important to realize that ICM is a NAPFA-Registered Financial Advisor and is strictly Fee-Only. No compensation of any sort is received by ICM other than that paid by you and other clients. This puts ICM and your interests in line with minimal conflict of interest. Ask every advisor you interview about potential conflicts of interest. View ICM's fee details...

ICM does not sell anything. ICM is available to advise and coach you on important financial matters. ICM does not sell insurance, mutual funds, annuities or anything other than advice and service. ICM will never attempt to sell you anything. When interviewing a financial advisor, find out how they are compensated.

Asset allocation designed for your specific financial circumstances
Together we will design an asset allocation (specific amounts of cash, bonds, large companies, small companies, domestic companies, foreign companies, and new economy companies) that is optimized for your specific circumstances (financial goals, time horizon, and volatility preference).

Complete confidentiality
Confidentiality is a hallmark at ICM. All account data are housed in a secure manner and for additional security, a unique client number is assigned to each client. Reports and other materials use the client number rather than the client name. Clients are only discussed when necessary to accomplish official ICM business and then only with your advance permission. The client list is never divulged or distributed to anyone.

Supervision of special circumstances
A) Some clients are lucky enough to have concentrated positions in a single stock (usually from employee stock options). ICM can help manage these situations using a number of techniques that can maximize your potential gain while protecting you from a substantial loss if your company falters.
B) Employee stock options can be analyzed and a program to realize the maximum cash flow with minimal taxes can be devised.
C) Restricted stock can be a challenge to sell. ICM can help you through the maze of regulations and find a qualified buyer.

Regular face-to-face meetings
Many new clients like to meet in our office quarterly. Some decide that’s too often after they reach a comfort level with our results and detailed reporting. Meetings may also be held by telephone.

Employee benefit plan monitoring
Evaluation of 401(k), 403(b) and other qualified retirement plans in which you participate is part of the financial planning service available to you. ICM recommends investments to use in those plans and makes sure those investments fit within your overall asset allocation, then you execute the transactions. Employee stock purchase plans (ESPP) can be similarly monitored.

Investment supervision
ICM continuously researches investment opportunities by using a variety of resources including paid advice from proven investment analysts, personal attendance at technical, investment, and financial planning conferences, and professional quality analysis reports and tools purchased by ICM. The results of this research are available to clients via the stocks and mutual funds purchased for your accounts. Your managed accounts are monitored and rebalanced regularly according to the Investment Policy Statement approved by you.

Financial Education
Part of our job at ICM is to educate you about financial matters. We’ll do that in our periodic meetings. We consider it a large success when a client has learned enough that he or she is ready to become a Cookbook plan investor!

NO SURPRISES!
The Investment Policy Statement, designed by you with guidance from ICM, specifies the investments to be made on your behalf. You will always be in control and never surprised by investments made for you since you will know in advance what to expect.
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What investments does ICM use?
 This is completely dependent on the specific investment policy and asset allocation we develop together for you.  Those accounts with less than $1,000,000 total assets under management primarily use no-load stock mutual funds, and a few individual stocks and bonds.  ICM uses no-load mutual funds exclusively and makes use of index funds, institutional funds, exchange-traded funds, and other ultra low-cost funds that are not available to individual investors.  Accounts larger than $1,000,000 use some individual stocks and bonds along with no-load mutual funds.  The larger accounts have access to attractive strategies that include separate account management (experienced fund managers that buy and sell stocks directly for your account), ownership in pools of well-diversified first and second mortgages, and other strategies available only to accredited investors.
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What's your investment philosophy?
      Our investment philosophy is based on four major concepts:

1.   Investing for the Long Term:  Numerous studies have shown that stock market investing gets less risky as the investment time horizon increases.  Generally long-term means at least five years and preferably much longer.

2.   No Market Timing:  Until reliable stock and bond market timing services are invented (don’t hold your breath), ICM believes it’s most profitable to be fully invested to take advantage of the generous long-term returns provided.

3.   Tax-Efficient Investing:  ICM invests with your total after-tax return in mind.  With the use of individual stocks and bonds, rather than mutual funds, you and ICM control the recognition of taxable gains.  Managed accounts are reviewed near the end of each calendar year to see if realizing tax losses reduces your taxes.

4.   Expense-Efficient Investing:  ICM uses individual stocks and bonds and no-load index funds in part because these securities are very cost efficient.  Every expense dollar saved is another dollar of return for your portfolio.  You are paying a fee for ICM’s services but the savings generated by expense-efficient investing could exceed the fee.
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How are my assets kept safe?
Any securities purchased for your accounts and all cash balances are retained with a registered broker-dealer and other custodial institutions designated by the client.  ICM can not take custody of your assets.  ICM receives no commission or other financial benefit from any broker-dealer or other institution that may be used in connection with the client’s accounts.  The broker-dealer and custodial firm that ICM typically uses is Charles Schwab & Co.  Account protection provided by Schwab but of course the protection does not apply to fluctuations in the market value of your securities. Other custodial firms may be used with approval by the client.
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What’s your planning experience?
Rich Chambers has over 30 years of experience investing in mutual funds, stocks, bonds, and rental real estate. After registering as an investment adviser in 1999, he began charging a fee for managing client accounts.

Rich was employed in engineering positions with IBM, Data General, VisiCorp, and until May 1999, 3Com Corporation as a software-engineering manager. He holds a patent on wireless communications obtained while at 3Com. In May 1999 he joined a large Palo Alto fee-only financial planning firm where he served as a Financial Planner and Director of Information Technology. He holds an undergraduate degree in Electrical Engineering and a graduate degree in Business. He is a member of NAPFA, the Financial Planning Association, and the Garrett Planning Network, Inc., a nationwide network of Fee-Only planners.

In 1999 he became Certified Financial Planner (CFP) licensee. CFPs have the background and proven ability to provide consultation in the important areas of your financial life including investments, and tax, retirement, insurance, and estate planning. CFP licensees are required to satisfy ongoing education requirements to maintain the license. Please refer to the CFP Board of Standards website for more details or please request the Why You Should Choose a Certified Financial Planner™ Practitioner brochure for a detailed explanation of the requirements for licensing the Certified Financial Planner registered service marks.

His investment specialty is creation of an efficient, globally diversified portfolio using mutual funds and individual stocks and bonds when the amount managed warrants the added complexity. Since 1997, ICM has published the Investor’s Cookbook.

For more background and for experience information for Julie Schatz & Jennifer Cray, see "Who We Are"
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What additional materials are available?
Send an email containing your mailing address to richc@feesonly.com to request any of the following complimentary publications and documents:

Documents from the Certified Financial Planner Board of Standards:

Why You Should Choose a Certified Financial Planner™ Practitioner

Questions to ask a Financial Planner

What you should know about Financial Planning

Company Brochure

Sample Monthly Investment Commentary

SEC Form ADV Part II for ICM

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What about References?
References may be available but in order to protect our client’s privacy and confidentiality, they will only be provided upon request after a face-to-face meeting.
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CFP, CERTIFIED FINANCIAL PLANNER and CFP with flame logo are marks owned by the Certified Financial Planner Board of Standards, Inc. These marks are awarded to individuals who successfully complete the CFP Board's initial and ongoing certification requirements.