Ryan Krueger and Mike Catalano build portfolios with a handcrafted blend of stocks, bonds, and hard assets. Solutions are customized by collaborating with each partner before we begin managing assets for them. No packaged investment products will be found. A combination of “defense” and “offense” is balanced on an ongoing basis in order to support a game-plan capable of preserving and compounding future income streams to outpace inflation. Regardless of our successful track record, the game-plan does not rely on projected returns. Rather, each allocation will be based on a partner’s ultimate withdrawal rates with historical odds of success using a century’s worth of actual data, not “goals.” Otherwise, we will not form a partnership and often choose to politely decline a request to do so. Success is measured by a partner being unable to outlive their portfolio. Relying on average rates of return is not even discussed, since we believe a partner should not hire us to get through an average market, anyhow. We are hired to get through any market.

Based on years of feedback, our process is different than anything our partners had ever been exposed to in the past. After the original construction is completed together, we accept complete responsibility and discretion to manage the stock accounts, as private portfolio managers. Each asset is held in a partner’s own account, separate from every other partner, and the entire portfolio is managed proactively by K&C each and every day.

Partners choose to pay an all-inclusive fee, based on a fixed percentage of their assets under management. And just as in any other business, they are free to change their mind. If a partner should ever decide their best interests no longer are with K&C, there are no penalties or charges of any kind and furthermore, the remaining quarter’s fee would be rebated to a departing investor. This added luxury of owning every stock and bond in their own personal accounts affords each partner a flexibility not found when assets are inside many investment company products; the ability to change their mind without additional expenses. Our partners truly have nothing standing in the way of making whatever plans are most appropriate for themselves.

For a partner, this team results in a different experience when compared to a traditional brokerage relationship, or compared to owning any investment product where you cannot see where your dollars end up. Beyond the portfolio’s flexibility and its cost structure, the primary difference is the direct accountability and communication that we choose to enjoy with our partners, personally. Decisions are described and strategies are shared on an ongoing basis. Behind successes and failures are explanations, in writing and on conference calls. Private calls and meetings are scheduled regularly. In front of every investment stands nothing. There are no layers or middlemen or salesmen of any kind. Every partner sees exactly what they own and understands why. Throughout our entire careers, we have offered this kind of transparency and accountability, never knowing it would be carving out a niche in the process. Our opinion is that more of each could help save most investors from their worst mistakes.

K&C’s investment philosophies all take a back seat to disciplines which drive our money management process. The key is an understanding that losing hurts you more than winning helps you. If you lose -50% and then make +75%, Wall Street offers a strange suggestion about this “good” performance. A mutual fund can report that period offered an “average annual return of +12.5%” (75 minus 50 / divided by 2 years = 12.5). K&C would suggest that is some awfully kind math. Take a $1 through reality instead and you’ll get a very different number. It’s worth fifty cents after year one and even after a stronger year two you end up with 87.5 cents from your original $1. ($1 minus 50% = $0.50 plus 75% comes to $0.875) Preserving capital is not a separate recipe from compounding it; rather it is the key ingredient. For an accurate measurement of success and failure in this business a compounded rate of return is required, and K&C are happy to share our track record over any period. We update our P&L daily, and have instructed each partner to fire us if at any time they hear any sentence begin with “hang in there…”, or “over the long-term…” or anything remotely resembling excuses given on Wall Street to clients. There are no clients or customers at K&C. Instead, in a partnership you should expect to hear good and bad news.

Each investment discipline results from our own research which we choose to conduct in-house, personally, and unbiased by any outside influence. For our partners, we not only help them create wealth, but also the time and peace of mind to enjoy it. Our partners have access to one more truth at all times. K&C will always explain the answer to what we feel is the most important question an investor could ever ask of his money manager: where is your own money?

We make our motivation quite clear. The majority of Ryan’s and Mike’s own liquid capital is placed inside the same portfolios we manage for our partners. When we make mistakes, we suffer the most and twice, exactly as it should be. Our mission is then simple – any partner knows that we wish to make more money with them than from them.