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Tom Duncan

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Introduction - Tom Duncan

[music]

Tom Duncan: Hi, I'm Tom Duncan, founder of Vision Capital Partners. I started my career as a CPA at a firm that worked...

[music]

Tom Duncan: Hi, I'm Tom Duncan, founder of Vision Capital Partners. I started my career as a CPA at a firm that worked exclusively with private, closely-held businesses and corporate executives. I eventually left public accounting and got my MBA from the University of Michigan.

I then worked at Lincoln Financial and became one of their regional directors of investments, which involved helping 50 other advisers with creating and implementing investment portfolios for their clients. I founded Vision Capital in 2006 to create an independent firm registered directly with the SEC.

This independence provides flexibility in the types of solutions I can offer my clients. I'm passionate about helping families make smart decisions about their finances, whether it's mitigating the risk involved in owning a business, and the impact on their families and employees, or maximizing corporate benefits and planning for retirement.

I grew up in a family-owned business that had been involved in much of the estate tax planning throughout the years. I understand the complexity involved in coordinating business and personal finances as it relates to tax planning, estate distribution, and equalization issues.

I've also found that the unfortunate instances, when we've had clients pass away, our planning has allowed those who were left behind to not have to deal with the stresses of a disorganized or poorly structured financial situation in that difficult time of grief.

Outside of work, I'm a huge sports fan, particularly college football. I also enjoy spending time with my wife and three sons, playing golf, collecting and drinking wine. Our firm's core values are integrity, doing what's best for our clients, not for ourselves, and transparency, both in how we operate, and how we are compensated.

We meet with clients between one to four times per year, depending on the situation. We're constantly revisiting our client's life goals and making sure that their plan is congruent with those goals. Clients' lives can become complex quickly. We strive to help them organize their situation, and then optimize the way their goals are met in the most tax-efficient ways possible.

We not only help recommend creative solutions to client's problems, but we are also a catalyst to effectuate that change. We go to attorney meetings with clients. We interact with their CPA's. We find specialists to fill in any gaps or accommodate their other needs.

The core of what we do is investment management, but we also manage the professional relationships with attorneys and CPA's for clients. We also delve into strategies beyond retirement planning, like tax mitigation, insurance implementation, and [indecipherable 2:31] planning. We work best with business owners, executives and families that are responsible and conscientious.

We're able to navigate the complexity of their situations, and use our creative ideas in order to provide a framework for them to make smart decisions about their money throughout all phases of life. We also have a network of specialists we can access for clients' needs in legal, tax, insurance, etc.

My experience as a CPA grounds my planning and thoughtful analysis in looking at situations with the tax overlay. We're able to look thoroughly at the facts and make reasonable projections to manage to a range of potential outcomes for clients over their lifetimes. Interested in learning more? Book time to speak with me today.

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Passive vs Active vs Structured Investing - Tom Duncan

[background music]

Tom Duncan: Hi, I'm Tom Duncan, founder of Vision Capital Partners. The passive versus active approach to investing has become a hot...

[background music]

Tom Duncan: Hi, I'm Tom Duncan, founder of Vision Capital Partners. The passive versus active approach to investing has become a hot topic. In a nutshell, passive investing is following an index created by a third party like the Russell 3000 Index or S&P 500. Active management is where a manager picks a set of stocks they think will outperform the market overall.

We adhere to an approach known as structured investing, which is a passive rules-based approach that does not follow a third party's index. Passive investing has an inherent problem, reconstitution. A good example is the Russell 2000, which is a small-cap stock index.

Most people purchase the index, and every year the index creators, in this case Russell, will adjust the makeup of the index as the market values of those underlying companies change.

Somewhere in the middle of the year, Russell will make known upcoming changes to their index. The index funds that follow the Russell 2000 will know exactly what stocks they have to buy and which they have to sell. Actually, everyone outside the index will know the same information.

That's when we typically see what's known as the reconstitution effect. Other market participants start selling the companies that are slated to leave the index, driving prices down, and buying the companies that are being added to the index, which drives their prices up. This creates a dislocation in those stocks.

What we do is invest in a family of mutual funds that don't adhere to these same criteria. These mutual funds will own stocks based on their own rules, and the reconstitution effect can be mitigated.

Our structured investing gives us more purity of asset class exposure than a regular ETF or index fund. The funds that we use are intended to capture specific dimensions of the market based on Nobel Prize-winning academic research.

We're as pure as we can be when it comes to the structured investing approach. When looking at active management, many people review how managers performed in the past, but there's been found to be no correlation between past performance and how a manager will perform in the future.

Our adherence to this structured approach is something our firm has done for over 15 years. The "2017 Mutual Fund Landscape" report by Dimensional Fund Advisors indicates for the 15-year period through 2016, only 17 percent of equity funds and 18 percent of fixed income funds survived and outperformed their benchmarks.

You can't buy the returns that were made in the past by active managers, so you're playing a losers' game if you're trying to beat an index in this way. It's even more difficult to tell if any of that outperformance with the manager was the result of luck or skill.

The 2017 study, "Do Stocks Outperform Treasury Bills?" by Hendrik Bessembinder, Professor at Arizona State University, found that roughly four percent of stocks created all the return of a diversified index portfolio.

Obviously, if you're overweighted in the four percent of stocks that have done better over the past 20 years, you'd have beaten the index. What if you underweighted, or worse, excluded some of that four percent? Being broadly diversified and structured ensures that we capture market returns without missing out on who that four percent may be over any given time frame.

We always try to educate our clients based on our structured point of view of investing, so that they understand how their money is being invested. For some of our very high network clients, there may be some asset classes like private equity or select hedge funds that we'll utilize that fall outside of our structured investing approach. For the vast majority, that approach works for them.

Interested in learning more? Book time to speak with me today.

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