A New Year: A New Beginning

This is the first Commentary published by our new firm and we are proud to use it to display the very broad array and depth of talent and insight that the merger of Kochis Fitz and Quintile Wealth Management has assembled.  We’ve brought these two firms together for several key purposes: to preserve our independence for the indefinite future, to provide greater career opportunities for our people, but chiefly, to enhance the scope and quality of our services to our clients.  We hope this Commentary provides a preview of many good things to come.

Some of the thoughts that follow will seem more familiar than others.  As the integration of our firms’ service offering proceeds over the coming months, we’re confident that you will appreciate, even enjoy, some new perspectives and fresh insights.

While overall investment performance for client portfolios for the full year of 2007 was respectable, the final quarter of 2007 continued the tone of uncomfortable market volatility.  Markets were up strongly in October, very weak in November, and up and down in December as the year drew to a close.  Still, 2007 performance for client portfolios was in line with long range expectations for their asset allocations and demonstrated again the wisdom of broad diversification.  Happily, no clients suffered any significant exposure to the direct losses incurred in the big investment story of the year.  The worldwide credit crisis, spawned by the domestic sub-prime mortgage debacle, took its toll, indirectly, of course, by deeply unsettling equity and bond markets.  Rich Palmer provides considerable insight on this in one of the articles below.

We always decline to offer any short-term predictions, and with the still unfolding credit situation, weak residential real estate statistics, continuing geopolitical turmoil, near record high oil prices, and an election year coinciding, it might be especially foolish to do so now for the coming year.  Market performance in the first week of 2008 is not offering any especially happy news.  Still, we are confident that the durable investment strategies we’ve helped our clients develop, combined with our continuing search for better, cheaper, and more tax efficient means of implementing those strategies, will continue to serve our clients very well in 2008, and beyond.

With our sincere best wishes for a happy and successful new year…and our genuine commitment to do all we can to make it so.

Tim Kochis, San Francisco
Rob Francais, Los Angeles