About Balboa Wealth Partners, Inc.
Balboa is a Registered Investment Advisor with the SEC.
How do you work with me?
Clients engage Balboa Wealth Partners directly or with their Advisor to allow us to provide certain services to you. You will receive our FORM ADV and sign an engagement agreement. Your Advisor will document your unique situation, and often develop a written plan or investment policy statement.
How do you charge for your services?
We offer clients several ways to engage and pay for our services. Most commonly clients will pay for investment management services based on a percentage of the assets we manage. However, some of our services do not involve managing money and those can be paid hourly, or on a project basis. We will develop a scope of work, and communicate all fees on an engagement agreement. You have the right to rescind the engagement via written notice within 5 days of signing the engagement agreement.
Where can I learn more?
Please review our FORM ADV Brochure to learn more about our services.
Please remember that past performance is not indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly on this website, would be suitable for your portfolio.
Due to various factors, including changing market conditions, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained on this website serves as the receipt of, or as a substitute for, personalized investment advice from your Advisor or Balboa Wealth Partners, INC.
To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing.
Understanding how performance is calculated and communicated
Balboa will generally report performance based on a Time Weighted return basis. With certain securities, where indicated, IRR will be used.
Balboa will publish returns to investors on a net of fee basis, unless otherwise indicated.
When evaluating an investment portfolio, you may simply want to know whether the portfolio had a gain or a loss during a certain period. Defining that gain or loss brought about the creation of performance measures. Performance measures are designed to produce numbers that represent percentage returns. They are designed to give relevant information on the total portfolio’s performance. The information should give a common means of measure against other investments and other portfolio managers. Although an evaluation requirement may be simple in nature, measuring performance and
the resulting return figures can become very complex. There are several ways to measure performance, and under given circumstances different performance measures will even produce different returns from the same data.
TWR- Time Weighted Return is the required measure by the Global Investment Performance Standards
(GIPS). It is used throughout the money management industry. The reasoning behind this is twofold. Firstly, a money manager may not directly control the timing or the amount of client contributions and withdraws from their portfolio. TWR gives a rate of return that eliminates the effects of cash flows.
Secondly, TWR is used by the money management industry because it measures how the money was managed. It attempts to show the investor how well their money was managed, whether the portfolio was worth $1,000 or $1,000,000. The TWR number can then be used in direct comparison with other managers’ TWRs for the same period.
DWR/IRR- A multi-period Dollar-Weighted Return (DWR) is also referred to as the Internal Rate of Return (IRR), because it will generate a discount rate where the present value of the cost of an investment equals the present value of the return on the investment. The DWR calculation gets its name from the way its return number will be more influenced by periods when the portfolio’s dollar-value is larger. The above example is “dollar-weighted” because the performance in the second year, when two shares are owned, has a greater influence on the overall return than the first-year when only one
share was held. Because it is so influenced by cash flows, a DWR can be positive only because money
was added; or it could be negative due only to withdrawals from the account.
Since the manager cannot control cash flows and the total dollars invested in the portfolio it is seen as inappropriate to use a measure like DWR that skews returns based on dollar amount size. TWR will generally differ from DWR, and the difference can be positive or negative depending on the period returns and portfolio activity. This usually happens at an early stage of a portfolio’s management, when assets may flow into an account at various times, or any time there are numerous cash flows in and out of an account.
So in final summation, the two key elements to take away from this in regards to TWR are: that cash flows, which affect the dollar amount of an account, do not affect the TWR; and that, the TWR measures how the money was managed, not the overall dollar amount change.
The information contained herein is intended to assist you in evaluating different investment portfolio performance measures. The information in this article is for educational purposes only. The information does not constitute investment advice or an offer to invest or to provide management services and is subject to correction, completion, and amendment without notice. Where specific advice is necessary or appropriate, consult with a qualified tax advisor, CPA, financial planner, or investment manager.
Where are my assets held?
Balboa does not custody your assets. Currently, we manage money for clients on Schwab, TD Ameritrade, Interactive Brokers, SEI platforms. We will help you make informed choices about your custodian. Your custodian will send you monthly statements and tax reporting annually.
How is my information protected?
Much of the information clients provide to us over the course of our professional relationship is non-public, private information. Your privacy is important to us. We understand that the foundation of our relationship is conditional on the proper safeguarding of your personal information.
How do you communicate with me?
Your Advisor is your primary contact and takes the lead in communicating with you. Balboa leverages leading portfolio management tools to bring comprehensive portfolio reporting to clients. We remain continuously available to meet in person and over the phone. Quarterly and Annual reports, along with client reviews, will keep you informed about the decisions and transactions in your accounts. Balboa will manage your account on either a limited, or fully discretionary manner. Please refer to our Form ADV Brochure for more complete information about fees, services, reporting, and our fiduciary duties to you.
Where do you do business?
Balboa Wealth Partners, INC is a registered investment advisor with the SEC and is located in Newport Beach, California. Balboa Wealth Partners, INC may only transact business in those states in which it is registered or qualifies for an exemption or exclusion from registration requirements. This website is limited to the dissemination of general information pertaining to its diversified services. Accordingly, the publication of this website should not be construed by any consumer and/or prospective client as a solicitation to effect, or attempt to effect, transactions in securities or the rendering of personalized investment or tax advice for compensation, over the Internet. Remember that past performance is no indication of future results. Investments are generally not FDIC insured, and may lose value.
Do you have a business continuity plan?
Balboa has adopted a business continuity plan. You can read it by clicking the link below.