Case study: a family office

We were making a presentation on investment strategy to a hospital foundation when a gentleman from the meeting told us he wanted to introduce us to his European business partner.

His partner had set aside a significant amount of trust money for his daughter and grandchild. While the money was invested in three different European banks, there was no real objective set down as to what was required of the trusts.

We were brought in to review the portfolios, develop recommendations, and then present them to the trustees of the family office. After our due diligence, we learned that all three banks acting independently were basically doing the same thing – which meant there was no diversification. We recommended diversifying the portfolios into five different trusts, arranged in a manner that would address the needs of each benefactor as they got older.

Our new client agreed with our strategy, and we transferred the investment accounts for them. We continued to diversify the portfolio with the evolving requirements of the benefactors. We maintained the accounts offshore for tax purposes and had to balance the spending in both dollars and euros and determine the most advantageous currency to use. In addition, the trustees would hire different accountants from time to time, requiring us to change the tax status of the accounts per their request.

Working with the trustees, we were able to grow the investments over time – what was $100 million when we began our client relationship years earlier is today valued at $500 million.

This material is and not intended for use as investment advice. It does not guarantee the attainment of your goals. Individual results will vary. There is no assurance that any investment strategy will be successful. Investing involves risk and investors may incur a profit or a loss. Past performance is not indicative of future results.