DavidgeCo title 521 Fifth Avenue, 17th Floor
New York, NY  10175
Phone 212-749-1637   Fax 212-866-9692
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Davidge & Company FAQ

Frequently Asked Questions

Who needs an investment counsel?
What does an investment counsel do?
Does the investment counsel receive commissions from the brokerage or bank?
Is it expensive to hire an investment counsel?
How has Davidge & Co. performed?
How should you select an investment counsel?


Who needs an investment counsel?

An individual, family or trust with assets in the range of $750,000 and above. Irrespective of assets, please feel free to call us. We regard ourselves as long term investors in both assets and relationships.


What does an investment counsel do?

They advise clients on how to invest their legacy portfolios, savings, retirement accounts and trusts in a balanced allocation of assets. The assets are comprised of individual stocks, bonds, real estate and partnerships selected by the investment counsel based on research.
The client's assets are kept at a custodian, a bank or brokerage firm. The investment counsel, on behalf of the client, places orders to buy and sell assets in consultation with the client. The firm negotiates favorable fees on behalf of the client, and assures good service.
To properly advise a client, the investment counsel must consider many factors about the client: short and long term investment goals, cash flow needs, earned income projection, tax considerations.


Does the investment counsel receive commissions from the brokerage or bank?

No. The investment counsel's income is based solely on a fee for assets under management. The goals of the investment counsel and client are financially aligned. If the firm protects and grows client assets, revenues grow over time.


Is it expensive to hire an investment counsel?

If you have to ask, you probably can't afford one. Just kidding. Davidge & Co. costs less that other alternatives to mange a portfolio of diversified assets. The asset choices available to the firm's clients are broader than those available to the mutual fund industry.
The investment counsel provides dispassionate, timely decisions tailored solely on the client's goals, tax situation and financial well being. Considering the need for a diversified portfolio, and the choices available, an investment counsel is essentially costless, and should provide superior after-tax results. The benefits of prudent counsel will be many times the fees charged.

How has Davidge & Co. performed?

The short answer is: excellent.
Most of our business comes from referrals of satisfied clients, and we are happy to provide references to prospective clients. We urge clients to view our paper: The Performance Measurement Trap.
The long answer is that performance measurement is a gnarly subject. Very large firms aggregate all their clients, and perform expensive, complicated statistical analysis on the performance of asset classes. The performance measurement serves as a good marketing tool. And, surprise, statistics can be manipulated to create favorable misimpressions.
Performance measurement gives absolutely no measure of how well the firm has done selecting the right asset allocation for an individual client. Nor are performance measurements presented on an after tax basis or in the context of how much risk was taken - both essential criteria for the individual client. The performance measurement is quite expensive, and the cost results in higher fees to the client, which reduce their return.
We are in favor of performance measurement. Every quarter, in good markets and bad, our clients see how we protect and grow their assets. We think the fact that Davidge & Co. has never lost a client speaks to the measurement issue.

How should you select an investment counsel?

First, as we are aware purely by hearsay, it is like going to a psychiatrist: you must realize that you need the service or a change in service providers.
Second, interview several, to gain perspective. The decision is important. It behooves the prospective client to invest time in the process. It is like we hear about selecting pediatricians: 'make sure you find one you like, because you are going to have a long and intimate relationship'. Assuming the requisite skill-set on the part of the investment counsel, the relationship will work best if the client has confidence.
Davidge & Co. provides a service unique in the business. On a complimentary basis, our firm meets in person with the client, travelling as necessary. We learn relevant details about the client. Then, we construct for the client a model portfolio with individual security names, tailored to the clients requirements. The estimated after-tax returns are projected over 5, 10 and 15 year periods.
There are several advantages of this process for the client and firm. The client gets to know Davidge & Co. well. Second, the investment plan has been mutually agreed upon in advance. The client, therefore, enters into the relationship with a high level of confidence. The plan, of course, is not static. Depending on markets, the plan may require a period of months or years to implement, and is refined quarterly as markets and client situations change.

 
 

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