A1A Wealth Management, Inc. Moving to 
River Capital Advisors, L.C.

Mark Dennis Transitions to River Capital Advisors

Press Release: Mark Dennis of A1A Wealth Management

One of the challenges associated with running a solo financial planning practice is deciding when and how to expand operations while keeping in mind the best interests of my clients and preserving the personal touch along the way. With this in mind, I am pleased to announce that my independent financial planning services will soon expand substantially, offering access to an experienced multi-disciplinary team of Certified Financial Planner™ professionals, Certified Public Accountants, Chartered Financial Analysts, and more.

Effective December 9, 2013, I will begin transitioning my solo financial planning practice at A1A Wealth Management, Inc. into the independent registered investment advisory firm of River Capital Advisors, L.C. located in Jacksonville, FL, where I will join their team as a wealth manager. Our two firms have much in common, including an independent fee-only approach to asset management and a dedication to fiduciary responsibility where we keep the best interests of clients ahead of our own. More information about River Capital Advisors, L.C. is available at their web site:  www.rcawealth.com

In addition to their team of financial planning and asset management professionals, River Capital Advisors is an affiliate of the locally-owned public accounting firm, Smoak, Davis, and Nixon LLP. Organized in 1924, this esteemed accounting firm is one of the oldest in Northeast Florida.  The current financial services team has over 150 years of combined professional experience with which to assist clients across a variety of investment, tax, and financial planning needs.

Mark Dennis who is also this year’s Sunrise Rotary Club president sums the transition up as very complementary: “Combining my business with River Capital Advisors now gives my clients access to a team of financial planners (instead of just one), along with a group of local tax experts and investment managers.”

If you would like to know more about this exciting development or wish to touch base regarding your current financial planning and investment management needs, please give Mark a call at 904-583-1887.

Correlation Diversification Frustration

The importance of asset correlation

It is important to define te real difference between asset classes

Investors hear a lot about the benefits of asset allocation, that is, spreading your assets among different types of investments to help reduce risk (1). Somewhat less discussed is an equally important measurement: correlation, which is a way to measure how closely related two types of investments are. In theory, you could be invested in multiple securities of differing types and classes, but if they are all closely correlated, your portfolio may not be as diverse as you think — and could open you up to more risk than you intended.

Mathematically, correlation is expressed as a number between 1.00 and -1.00.
•    A “1.00” indicates an absolute positive correlation (that is, the assets under comparison always move together in the same direction).
•    A “0” correlation indicates there is no relationship between the assets.
•    A “-1.00” indicates an absolute negative correlation (the assets always move together in opposite directions of each other).

Very few assets have a pure 1.00 to 1.00 or -1.00 to -1.00 relationship. Generally, most experts consider a correlation value between 0 and 0.50 as a weak correlation, while a value of 0.50 and higher is progressively stronger. The farther from a 1.00 correlation two investments are, the more diversification you may realize.

If you’d like to determine the correlation of your portfolio, the easiest way may be to contact your financial professional. You can also search the Web for an investment correlation calculator — a number of brokerage firms and other financial sites have tools, but few are free to use.

The Markets March in Unison
One important consideration for investors to keep in mind is that the financial markets are increasingly marching in unison, making correlating your investments increasingly difficult. A variety of factors are causing this trend, including:

•    Globalized economies: The growth of global trade and the proliferation of worldwide investment firms mean that the fortunes of both large corporations and the investors who own their stock are tied together as never before.
•    Reliance on U.S. dollars: Many foreign governments and global financial institutions rely on U.S. dollars as a reserve currency to pay debts or to influence exchange rates. Given this situation, the health of the U.S. economy and the actions of the Federal Reserve reverberate globally, as do events in Europe and beyond.

What Investors Can Do

If climbing correlations concern you, consider the strategies that may help you balance risk and return, including:
•    Combining stocks with other types of assets. Adding exposure to bonds, real estate, and commodities may help you to balance returns over the long term.(2)
•    Considering investments that generate income. Dividend-paying stocks, bonds, and REITs are popular with investors searching for income. When stock returns are uncertain, dividends provide something in the way of a return. Dividends are not guaranteed and companies that issue dividend-paying stock can stop at any time.

Be sure to remember that alternative investments and commodities are risky, too.

1. Asset allocation does not ensure a profit or protect against a loss in a declining market.
2. Investing in stocks involves risk, including loss of principal. Bonds are subject to market and interest rate risk if sold prior to maturity. Bond values will decline as interest rates rise and are subject to availability and change in price. Exposure to the commodities market may subject investors to greater volatility as commodity-linked investments may be affected by changes in overall market movements, commodity index volatility, changes in interest rates, or factors affecting a particular industry or commodity.