Is discretionary management right for you? (Image of book spines in a circle)

Discretionary management is an often misunderstood term which is why we find it helpful to point out the distinction between non-discretionary and discretionary.


In a non-discretionary advisor-client relationship, no decision to buy or sell securities in a client's account can be made without consulting the client. Even if it fits the client’s goals and values, the advisor needs to speak directly with the client first before pursuing opportunities. This often leads to inefficiency and bottlenecks in the investment process. A financial professional with a license to provide advice in this manner has the title Investment Advisor. They are an advisor, whereas the client is the decision-maker. Portfolio results are a collaboration between what the advisor suggests and what the decision-maker is willing to agree to. This is a great relationship when the client wants to manage their own portfolio, with advice.


In a discretionary manager-client relationship, a written Investment Policy Statement sets out the rules and strategies used to manage investments and the manager uses their discretion to make decisions within the confines of those goals and values. Reporting allows comparison of portfolio results to the plan, giving the client confidence they are on track. A financial professional with a license to provide management in this manner has the title Portfolio Manager. The client collaborates on forming the goals, risks, strategies, and guidelines around management, but the Portfolio Manager is the decision-maker. This is a great relationship where the client wants to delegate management of their portfolio, under supervision with written guidelines.

Here’s why we take a discretionary approach with our clients:

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We can build a portfolio unique to you

Our investment models are like building blocks. Each model may focus on individual bonds, pooled loan strategies, dividends, growth, tactical sector ETFs, alternative hedge funds, arbitrage investments, real estate lending and so on. Then we can uniquely scale and slot these models into an overall plan at varying proportions based on all of the criteria that you’ve identified as important. The result is a portfolio unique to you and your plan. But with models common to other clients which allow bulk trading across many clients simultaneously.

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We can capitalize on market opportunities

Being discretionary means we can immediately act on time-sensitive trades and activities that fit your values. We can initiate bulk trades as an accredited investor to get the best price and allocate it to each of our clients that hold that particular model fairly at the same price. Non-discretionary accounts must wait for individual authority for each transaction.

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We can save you time

Having an Investment Policy Statement that guides our decisions smooths the process. It reduces or eliminates detailed discussions about individual securities with you. Often clients who want to delegate management aren’t even interested in authorizing individual transactions, but they must if they are in a non-discretionary relationship. Instead, in a discretionary relationship, the time you spend conversing with us can be about planning, strategy, and the things most important to you.