Capital Management | Importance, Strategies & Examples
What is Capital Management?
Capital refers to economic assets, including a company’s office, intellectual property, inventory, shares and stock, cash balances, bank deposits, and other short-term accounts. Thus, capital is any resource that has value and, by using it, a business generates revenue.
The financial strategy that helps organizations maximize cash flow efficiency is called capital management (CM). Also known as working capital, it maintains an appropriate ratio between current assets and liabilities. In other words, capital management revolves around carefully analyzing company assets and liabilities and managing individual financial components to maximize efficient cash flows and increase earnings.
Aligning Client Portfolios With Life and Wealth Goals
What truly sets apart our history of success is the process by which we approach investment management. Our investment team performs in-house research and portfolio management across various asset classes, allowing our advisors to construct portfolios that are unique to each client’s circumstances. We review time horizons, investment goals, risk tolerances, and tax situations to determine the appropriate asset allocation and investment selection for each client.
Tax Efficient Management
It is not what an investor makes, it is what they keep that is most important. To that end, we are diligent about optimizing after-tax returns for our clients.
When possible, we allocate tax-inefficient investments into retirement accounts as well as tax-efficient investments into taxable accounts. We also harvest losses to offset capital gains and advise on concentrated positions with low cost basis.