Please feel free to contact us if this list leaves any questions unanswered.
We actively manage over $150
million in separate investment
accounts for individuals, companies,
We also offer comprehensive financial planning — including retirement planning, college planning, estate strategy, insurance, and general advice on all things financial — as a free service to our investment clients.
We differ from the typical
financial advisory firm in a number
Please see the About page for background on the staff at PCA.
No. Honesty, integrity, and the
welfare of our clients are extremely
important to us and we have a clean
bill of regulatory health to show
for it. Of course, we don't expect
anyone to take our word for it, so
we encourage you to use the
BrokerCheck feature at the website
of FINRA, the regulatory agency that
governs financial advisors.
From the BrokerCheck
site, you can run Broker searches
for PCA's partners, John Matthew
Simon and Richard Esteban Toscano.
Girard Securities, Inc. is a
Broker/Dealer and Registered
Investment Advisor. They deal with
the "back office" aspects of running
a financial advisory business. This
includes most of the regulatory
compliance tasks (of which there are
an enormous amount), accounting,
keeping all investment- or
planning-related forms and processes
up to date, and various other tasks.
Allowing Girard to handle all of
this stuff frees up our time to
focus on what is most important:
talking to our clients and managing
It's true that most active
investment managers fail to
outperform the market index after
fees are taken into account.
Individual investors, on average,
fare even worse. In our view,
though, this isn't because it can't
be done, but because most investors
simply don't do what's
required to outperform the market.
There is a very strong tendency for
investors — and this includes
professional investment managers —
to "chase returns." People buy
what's been going up, and sell
what's been going down. This
is a natural human instinct, and it
plays right into both our emotions
and the incentive structure of the
Unfortunately, it also results in
poor investment returns, at least
over the long term, because it
entails buying the most expensive
assets while shunning or selling the
There is actually plenty of
evidence, both from academic
research and in the existence of
longtime outperforming money
managers, that it is possible to
beat the market over the long
term. But this requires
fighting those return-chasing
instincts and focusing on what has
worked over time. This
includes varying investment posture
to have more exposure when markets
are cheap and less when they are
expensive, focusing on (often
unpopular) investments that are
cheap and priced for good or great
returns, and steering clear of
trendy and overpriced investments
that are likely to lead to poor
This is called "value investing,"
and while it's the opposite of what
the typical active investor does,
it's exactly what we do. It
requires work, discipline, and a lot
of patience, but over time, the
evidence has shown that it does
work. More details can be
found in this brief
slideshow summarizing our
Do you buy individual stocks or funds?
Our investment approach is based on determining how an investment should be priced based on its fundamentals. We feel that this is much more reliably determined at the asset class level than at the individual security level, so we tend to seek out asset class-level exposure. For this reason, we primarily use mutual funds or ETFs.
An additional benefit of this philosophy is that we get increased diversification, and diversification is a good thing (as long as you are not diversifying into overpriced assets).
We often utilize passive, low-fee instruments when they provide the exposure we are looking for, but we also use actively managed funds if we feel that there is a compelling reason to do so. In either case, we are very sensitive to fund expenses, and are primarily concerned with maximizing risk-adjusted returns after all fees.
Yes. We determine a risk profile
for each client based on goals,
timelines, liquidity needs, and
psychological risk tolerance. Other
factors such as outside investments
or asset class preferences may also
come into play. Clients are
encouraged to keep us up to date if
their situation has changed in a
manner that might impact their risk
Yes. We (the partners at PCA)
invest the vast majority of our
personal investable money into
exactly the same things we are
buying for our clients.
The managed brokerage accounts are typically held at National Financial Services (NFS), which is owned by Fidelity, and the direct mutual fund accounts are generally held at Franklin-Templeton Investments. Both firms are huge, established, and highly regarded. For more information see the NFS and Franklin Templeton websites.
Each client has their own separate
account(s) in their own names or in
the names of their trusts or
Girard and NFS are both members of the SIPC. SIPC offers protection in the case of brokerage firm financial troubles of up to $500,000 per customer (of which $250,000 can be cash). More information about this protection can be found at the SIPC website.
Additionally, NFS — where the investment accounts are actually held — has taken out extra private insurance with Lloyd's of London to cover investors beyond the SIPC limits to an aggregate loss level of up to $1 billion .
Mutual fund companies like Franklin-Templeton are not part of the SIPC. However, such companies keep fund assets at a separate custodian company, so trouble at the mutual fund management company should not impact the custodian's assets.
Yes. Clients receive statements at least quarterly, possibly more often depending on account type and activity.
Yes. Clients have access to an
online account monitoring website
where they can view account
holdings, activity, and performance
on a daily basis.
Yes, we offer comprehensive
financial planning as a free service
to our investment clients.
What are your fees?
Fees differ depending on account
size and type, but they are
generally below the industry average
for actively managed accounts.
What are your minimum investments?
Our minimum household investment is
What types of accounts can you manage?
We can manage many account types, including:
We cannot manage active
employer-sponsored 401Ks or Thrift
Savings Plan accounts, but we can
convert former employers' plans into
rollover IRAs that we can manage.
Can you work with clients who live out of state?Yes; we have many out-of-state (as well as in-state but distant) clients with whom we communicate solely via phone and email. We are perfectly comfortable with this approach so long as the client is comfortable as well.
Do you communicate with investment clients on an ongoing basis?
Yes. We feel strongly that it's important for long-term oriented value investors to have a firm understanding of why they own what they own. This helps to prevent the emotionally-driven mistakes that plague so many investors, such as panicking out of a perfectly good investment during a downturn, or feeling compelled to chase into popular but overpriced investments.
We send clients detailed quarterly
letters in which we discuss what's
going on in markets, how we are
invested, and why. The letters
often touch on other topics of
interest, such financial planning
issues or the local real estate
market. We also write more
detailed articles on this website
from time to time.
We are always happy to answer any
other questions clients might have
about the investments or their own
I'm interested in having PCA manage my investments — what are the next steps?
If you think you might be
interested in working with us,
please contact us to let us know what your
situation is and how you think we
might help. If there appears to be a
good fit, we can set up a meeting by
phone or at our office.