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A RT ICL E : Common Mistakes in Investment Portfolios © 3/2011 Resource Strategies, Inc. All Rights Reserved. By Keith M. Lichtcsien, CFP®, AEP® • Investment objectives have not been clearly established and documented. • Time weighted Rate of Return calculations have never been performed and reported, and there is no method for evaluating performance relative to risk. • The portfolio’s risk is high given its potential return. • An Investment Policy Statement setting forth objectives and asset class ranges has never been established. • Cash flow parameters have never been established. • There is no established method for systematically reviewing appropriateness of investment vehicles. • Pooled accounts and cash are held inside managed accounts. • Lack of comfort and confidence with advisor relationship. • Phantom Income and concomitant tax consequences are not being mitigated or even considered. • No disciplined process for rebalancing at specific intervals. • Not tracking progress toward stated goals. • No process for determining appropriate re-allocation decisions. • Unwittingly and unnecessarily exposed to unsystematic risk. • Advisor does not meet the 7 Standards test. As always, please feel free to call us at 216-765-0121 regarding this or any planning related questions. Fee-based Planning and Third Party Money Management offered through Resource Strategies, Inc., a State Registered Investment Advisor. Securities offered through ValMark Securities, Inc. Member FINRA, SIPC. 130 Springside Drive, Suite 300 – Akron, Ohio 44333-2431 – 1.800.765.5201. Resource Strategies, Inc. is a separate entity from ValMark Securities, Inc. 1 Fee-based Planning and Third Party Money Management offered through Resource Strategies, Inc., a State Registered Investment Advisor. Securities offered through ValMark Securities, Inc. Member FINRA, SIPC. 130 Springside Drive, Suite 300 – Akron, Ohio 44333-2431 – 1.800.765.5201. Resource Strategies, Inc. is a separate entity from ValMark Securities, Inc. 2