Summit Portfolio Management (SPM) is an SEC-registered investment adviser with its principal place
of business located in Las Vegas, Nevada. Summit Portfolio Management began conducting business
in March 1999.
• Timothy Francis Bock is 100% owner of SPM: CRD# 111243
Summit Portfolio Management offers the following advisory services to our clients:
Because some types of investments involve certain additional degrees of risk, they will only be
implemented/recommended when consistent with the client's stated investment objectives, tolerance for
risk, liquidity and suitability.
PORTFOLIO MANAGEMENT
Our firm provides asset management of client funds based on the individual needs of the client. Through
personal discussions in which goals and objectives based on the client's particular circumstances are
established, we create and manage a portfolio based on client’s individual objectives, time horizons,
risk tolerance, and liquidity needs. As appropriate, we may also review and discuss a client’s prior
investment history, as well as family composition and background.
We manage these advisory accounts on a discretionary basis. Account supervision is guided by the
client's stated objectives (i.e., maximum capital appreciation, growth, income, or growth and income), as
well as tax considerations.
Once the client's portfolio has been established, we review the portfolio quarterly or more frequently and
if necessary, rebalance the portfolio as needed based on the client's individual needs.
Our investment recommendations are not limited to any specific product or service offered by a
broker-dealer or insurance company and will generally include advice regarding the following securities:
• Exchange-listed securities
• Corporate debt securities
• Municipal securities
• Variable annuities
• Mutual fund shares
• United States Government securities
• Interests in real estate
• Structured settlements
• Fixed annuities
Investment advice may be offered on any investments held by a client at the start of the advisory
relationship. The primary vehicles recommended for investing are exchange traded funds and open-end
mutual funds. Summit Portfolio M a n a g e m e n t generally recommends investment grade bond funds.
Summit's security analysis is based on a number of factors, including those derived from academic
research and literature, commercially available software technology, securities rating services, general
market and financial information, due diligence reviews and specific investment analysis that clients
may request.
Summit Portfolio Management practices an evidence-based approach to investing (EBI) which is the
understanding the investment best practices and body of knowledge defined by the last 50-plus years of
academic and practitioner research. This research is ongoing and will continue to inform the
recommendations Summit makes to its clients. Summit believes there are five key tenets associated
with evidence-based investing (EBI):
Outperforming the market is difficult.
While Summit does believe there are ways to build portfolios through strategic allocation decisions
informed by academic evidence, Summit never loses sight of the fact that outperforming the market is
not easy. Given this fact, Summit generally recommends low-cost, tax-efficient portfolios to its clients.
Size, value, profitability and momentum tilts utilized for the equity component of a portfolio.
There is abundant academic evidence showing that small-cap stocks have historically generated higher
long-term returns than large-cap stocks, that value stocks — which are stocks with low prices relative to
earnings — have historically outperformed growth stocks, and that positive momentum stocks — which
are stocks with high returns over the last year — have historically outperformed negative momentum
stocks. Profitable companies have outperformed less profitable companies. Summit tries to capture these
historical long-term return premiums through the stock funds Summit uses.
Global stock market diversification is the starting point.
The academic evidence shows that investors should own U.S., international and emerging markets
stocks, not concentrating solely on U.S. companies. This research shows that diversification across
countries makes sense in the same way that diversification across companies does. We have no way of
knowing which particular country will generate the highest long-term returns (and Summit does not
believe anyone else does either), so we believe that diversification is the right strategy. Further,
approximately 40% of the world’s stock market value is located in non-U.S. companies, which is one
other argument for global diversification.
The primary role of fixed income is to reduce portfolio volatility.
Summit believes that academic and practitioner evidence shows that the most efficient way to build
portfolios is by taking risk through the stock of the portfolio and using fixed income to reduce portfolio
risk. This means that Summit’s fixed income recommendations primarily emphasize government-backed
securities, high-quality municipal and corporate bond funds because these securities tend to provide the
most effective diversification of stock market risks.
EBI slowly evolves over time.
Importantly, EBI is not static. Summit’s investment strategy recommendations will evolve as academic
and practitioner evidence evolves.
Long-term investment success means different things to different people. Summit believes that the best
investment plan for a client depends on the client’s specific circumstances and objectives. That is why
Summit begins the investment planning process in a discovery meeting with a conversation about the
client’s values, goals, relationships, assets, types of accounts, advisors, preferred processes and interests.
While every client’s situation is unique, certain factors should be considered in creating any investment
plan. These factors include the purpose of the portfolio, its size, specific funding sources, how and when
a client plans to use the funds, and the degree of uncertainty or risk a client is willing to accept in pursuit
of their objectives. As Summit establishes a clear vision of a client’s goals and circumstances, Summit
can build the foundation of an investment plan that best matches the client’s needs as well as the
realities of the financial markets.
As part of the assessment process with each client, Summit engages in a risk assessment process. For
many investors, their most important long-term goal is achieving financial independence. But most
clients also have intermediate-term goals, such as funding college education, travel or vacation homes.
Achieving these goals commonly requires some measure of risk since most investors need returns in
excess of inflation to meet their goals. Risk, however, is multifaceted, which is why Summit focuses on
three different aspects of risk in helping guide the asset allocation discussion.
Part One: Ability to Take Risk
A client’s ability to take risk is most commonly a function of (1) the time horizon(s) of the client’s
investment objective(s), (2) whether the client is working or retired, and (3) the stability of the client’s
job. Longer time horizons argue for more aggressive asset allocation strategies because a long time
horizon gives the portfolio more time to recover after periods of poor performance.
If a client is still
working, he or she may be able to be more aggressive since the portfolio is likely not needed to support
spending needs. Investors in more stable jobs (e.g., a university professor) generally have greater ability
to take risk compared to investors with jobs that are more sensitive to the performance of the economy.
Part Two: Willingness to Take Risk
Willingness to take risk measures a client’s tolerance for risk. Specifically, we measure the amount of
portfolio loss a client is capable of experiencing without it significantly affecting the client’s quality of
life or causing the client to change portfolio strategy. This is a crucially important aspect of risk because
changing portfolio strategy after a client experiences risk is something the client’s portfolio may not
recover from.
Part Three: Need to Take Risk
Need to take risk is directly tied to the client’s rate-of-return objective. If a client needs relatively high
returns to achieve his or her goals, the need to take risk is high. But this will require a more aggressive
asset allocation, which could be in conflict with a client’s ability or willingness to take risk. Need to take
risk is typically relatively high for investors who expect to withdraw (or are withdrawing) a relatively
high proportion (e.g., a withdrawal rate in excess of 3 percent) of their investment portfolios to fund
living expenses.
Risk of Loss
Investing in securities involves risk of loss that clients should be prepared to bear.
All investments present the risk of loss of principal – the risk that the value of securities (mutual funds,
exchange traded funds (ETFs)), when sold or otherwise disposed of, may be less than the price paid for
the securities. Even when the value of the securities when sold is greater than the price paid, there is the
risk that the appreciation will be less than inflation. In other words, the purchasing power of the
proceeds may be less than the purchasing power of the original investment.
The mutual funds and ETFs utilized by Summit may include funds invested in domestic and
international equities, including real estate investment trusts (REITs), corporate, municipal and
government fixed income securities. Equity securities may include large capitalization, medium
capitalization and small capitalization stocks. Mutual funds and ETF shares invested in fixed income
securities are subject to the same interest rate, inflation and credit risks associated with the underlying
bond holdings.
Among the more risky mutual funds used in Summit’s investment strategies are the U.S. and
international small capitalization value funds and emerging markets funds. Conservative fixed income
securities have lower risk of loss of principal, but most bonds (with the exception of Treasury Inflation
Protected Securities (TIPS) present the risk of loss of purchasing power through lower expected return.
This risk is greatest for longer-term bonds.
Certain funds utilized by Summit may contain international securities. Investing outside the United
States involves additional risks, such as currency fluctuations, periods of illiquidity and price volatility.
These risks may be greater with investments in developing countries.
More information about the risks of any particular market sector can be reviewed in representative
mutual fund prospectuses within each applicable sector.
Equity Securities Risk. Equity securities (common, convertible preferred stocks and other securities
whose values are tied to the price of stocks, such as rights, warrants and convertible debt securities)
could decline in value if the issuer's financial condition declines or in response to overall market and
economic conditions. A fund's principal market segment(s) – such as large cap, mid cap or small cap
stocks, or growth or value stocks – may underperform other market segments or the equity markets as a
whole. Investments in smaller companies and mid-size companies may involve greater risk and price
volatility than investments in larger, more mature companies.
Fixed-Income Securities Risk. Fixed-income securities are subject to interest rate risk and credit quality
risk. The market value of fixed-income securities generally declines when interest rates rise, and an
issuer of fixed-income securities could default on its payment obligations.
Asset Allocation Risk. A fund's selection and weighting of asset classes and/or underlying funds may
cause it to underperform other funds with a similar investment objective.
FINANCIAL PLANNING
We provide financial planning services. Financial planning is a comprehensive evaluation of a client’s
current and future financial state by using currently known variables to predict future cash flows, asset
values and withdrawal plans. Through the financial planning process, all questions, information and
analysis are considered as they impact and are impacted by the entire financial and life situation of the
client. Clients purchasing this service receive a written report which provides the client with a detailed
financial plan designed to assist the client achieve his or her financial goals and objectives.
In general, the financial plan can address any or all of the following areas:
• Personal: We review family records, budgeting, personal liability, estate information and financial
goals.
• Tax & Cash Flow: We analyze the client’s income tax and spending and planning for past, current
and future years.
• Investments: We analyze investment alternatives and their effect on the client's portfolio.
• Insurance: We review existing policies to ensure proper coverage for life, health, disability,
long-term care, liability, home and automobile.
• Retirement: We analyze current strategies and investment plans to help the client achieve his or her
retirement goals.
• Death & Disability: We review the client’s cash needs at death, income needs of surviving
dependents, estate planning and disability income.
• Estate: We assist the client in assessing and developing long-term strategies, including as
appropriate, living trusts, wills, estate tax, asset protection plans.
We gather required information through in-depth personal interviews. Information gathered includes the
client's current financial status, tax status, future goals, returns objectives and attitudes towards risk. We
carefully review documents supplied by the client, including a questionnaire completed by the client,
and prepare a written report. Should the client choose to implement the recommendations contained in
the plan, we suggest the client work closely with his/her attorney and accountant. Implementation of
financial plan recommendations is entirely at the client's discretion.
Typically, the financial plan is presented to the client within six months of the contract date,
provided that all information needed to prepare the financial plan has been promptly provided.
Financial Planning recommendations are not limited to any specific product or service offered by a
broker-dealer or insurance company. All recommendations are of a generic nature.
AMOUNT OF MANAGED ASSETS
Discounts, not generally available to our advisory clients, may be offered to family members and friends
of associated persons of our firm.
As of 3/8/2024, SPM is actively managing $158,934,022 of clients' assets on a discretionary basis.
Assets managed on a non-discretionary basis: $10,118,937. Total assets under management:
$169,052,959.