No matter which distribution conduit you are engaging, the key is to build relationships. We spend a lot of time researching firms and advisors before we even reach out to them. We want to ensure there is a fit before we pick up the phone or hit the send button. We also ask advisors to share information with us about their firm, their client base, their primary concerns, and what is most important to them when deciding whether to utilize a fund within their portfolios. We want to understand their needs, concerns and objectives before we can decide how best to serve them.
This first year of operation was difficult. Getting the assets into the fund and then establishing the portfolio positions took time. It was sometimes painful to see our daily NAV drop into the red due to the incurrence of fund expenses without corresponding investment income. Although we admonish our advisory clients regarding the temptation and stress of too frequent monitoring of their portfolio performance, we definitely check our NAV daily as soon as it is posted. Fortunately, once our investments started to kick in, the fund performed better.
Knowing what we know now, would we make the same decision to launch our own fund? Definitely. Despite huge challenges and a tremendous amount of work, we now have a product available to many more investors than our advisory practice alone could reach. We truly believe it is a timely solution for other advisors and their clients.
Thinking about starting your own fund? I strongly encourage it. What I love most about our industry is how dynamic it is. It is never dull or boring. We always need new ideas, methods, and solutions. Maybe yours?
Thomas M. Geier, CPA, CFP, PFS, is the portfolio manager of the Geier Strategic Total Return Fund (GAMTX) and vice president of the fund's advisor, Geier Asset Management Inc.