A. The Firm. Tiemann Investment Advisors, LLC (TIA) is a privately held
investment advisory business, founded in 2002 and organized as a California
Limited Liability Company (LLC). TIA’s owners are Dr. Jonathan Tiemann and
Valerie Gardner. Dr. Tiemann commenced with managing a small number of
portfolios and within a few months, opened an office on University Avenue in
Palo Alto to serve the needs of individual investors and families. TIA relocated
to larger offices in Menlo Park in 2004 and remains closely held by Dr. Tiemann
and Ms. Gardner. TIA has no subsidiaries or indirect owners.
B. Types of Advisory Services.
TIA offers two types of investment advisory services to individuals and
institutional clients: Portfolio Management and Portfolio Consulting. As
discussed below, these advisory services involve components similar to financial
planning to facilitate individualized tailoring; however, TIA does not consider
itself or hold itself out as a financial planner. In addition, TIA provides various
investment services to other investment professionals.
PORTFOLIO MANAGEMENT
TIA provides continuous investment advice, designing and managing securities
portfolios seeking to address the circumstances of each client. The process
begins with a profile, which includes the usual considerations of investment
horizon and risk tolerance, but goes beyond these to include the client’s
individual circumstances and holdings. These circumstances include the client’s
occupation, geography, and portfolio restrictions stemming from social
preferences, historical loyalties, or restricted holdings. TIA’s approach aims to
achieve a portfolio design that complements, rather than redoubles, the risks
already inherent in the client’s life and circumstances. In many instances, these
considerations lead to individualized choices of sector allocations for client
portfolios.
TIA manages portfolios that include an array of investments across a variety of
asset classes. In general, TIA uses instruments readily traded in US securities
markets. For asset classes with sufficiently large allocations, TIA will generally
create portfolios of individual securities. This approach applies most commonly
to US large-capitalization equities, US Treasuries, and municipal bonds. For
asset classes with smaller allocations that do not permit sufficient diversification
at reasonable cost through individual securities, TIA may invest through
exchange-traded funds (ETFs), and through other pooled vehicles such as mutual
funds.
Clients will ordinarily give TIA a limited power of attorney to act on a
discretionary basis with their funds. TIA will not take or maintain possession or
custody of funds or securities for any client. The client funds and securities will
typically be deposited in a brokerage firm account, with the broker acting as
custodian. With client consent, TIA may cause fees to be paid out of Portfolio
Management accounts by the client’s custodian. Prior to doing so, TIA will send
the client an invoice showing the amount of the fees, the value of the assets on
which they are based, and the fee computation. TIA fees are paid in arrears.
PORTFOLIO CONSULTING
TIA’s Portfolio Consulting service comprises a series of portfolio planning and
design services. These include developing and stating an asset allocation plan,
designing a strategy for building a diversified portfolio, and articulating an
overall portfolio management strategy. TIA may summarize these plans in a
formal Investment Policy Statement designed to govern the implementation of
the portfolio plan.
Clients engaging TIA for Portfolio Consultation services may also from time to
time request that TIA evaluate investment opportunities or managers to which
they are contemplating committing funds. TIA will evaluate such opportunities
and express a view reflecting the firm’s professional judgment, subject to the
understanding that such judgment does not in any way diminish the risks
inherent in all investment decisions. In the event that a client has presented TIA
with an investment that the client has made which, in TIA’s view, reflects an
improper risk, TIA will indicate its view to the client and may recommend an
exit strategy.
TIA may also perform an ongoing portfolio monitoring and reporting function,
creating periodic written reports, if desired. These reports cover the portfolio's
value, performance, and effective asset allocation, along with relevant
comparisons to market indices and to portfolio plans. These reports will be
intended to supplement and interpret clients’ custodial statements, which remain
the definitive record of client holdings. TIA may also arrange in-person
meetings with clients for some or all of these reviews. While TIA has performed
this service for various clients at various times, TIA currently has no Portfolio
Consulting clients.
SERVICES FOR INVESTMENT PROFESSIONALS.
TIA offers to investment professionals the capability of bringing high-level
expertise directly to bear on the management of their clients’ portfolios. TIA may
provide generic models and presentation materials, individual portfolio analysis,
portfolio design services, and, where appropriate, individual portfolio
monitoring and custom reporting. Under this arrangement, TIA can be available
to meet with clients individually.
Unrelated investment advisors may from time to time choose to recommend that
clients allocate all or a portion of their assets to TIA for portfolio management as
described above. In all such cases, TIA’s services are distinct from those of the
advisor, and provided under a separate contract and for a separate fee, using a
schedule negotiated on behalf of the client by the investment advisor. In
addition, TIA may perform transition or overlay portfolio management in
individual cases. Fees for these services are individually negotiated.
Fees for investment professionals depend on the scope of services, and are
negotiated and typically paid in arrears. With the exception of portfolio
management and construction of model portfolios, TIA is typically compensated
for these services on an hourly or fixed fee basis; fees are generally negotiated.
Lower fees for comparable services may be available from other sources.
From time to time TIA will assist clients in evaluating securities or transactions in
which they express an interest. TIA does not propose such transactions or
securities, but ordinarily only evaluates them at client request. TIA may
negotiate an hourly or flat fee for such an evaluation, and may waive such a fee
for Portfolio Management clients. This service may also be part of a Portfolio
Consulting service.
TIA’s President, Dr. Jonathan Tiemann, may act as an expert witness for various
organizations or entities, including governmental agencies. TIA has in the past
been engaged to provide expert witness service to the US Department of Labor,
but the matter for which Dr. Tiemann performed that function has been resolved.
Dr. Tiemann may also consult with commercial entities wishing to become
investment advisers or otherwise become involved in or provide services to the
US or international investment industry.
C. Tailoring of advisory services.
PORTFOLIO MANAGEMENT.
Tiemann Investment Advisors, LLC (TIA) offers comprehensive, individualized
portfolio planning and execution services for high net worth individuals and
other investors with significant assets. TIA uses the quantitative tools of Modern
Portfolio Theory to design and create portfolios to address the unique risk profile
of each client. This profile begins with the usual considerations of investment
horizon and risk tolerance, but goes much further, examining the client’s
individual circumstances and holdings. These circumstances include the client’s
occupation, earnings, asset holdings, geography, and portfolio restrictions
stemming from social preferences, historical loyalties, or restricted holdings.
TIA’s approach aims to achieve a portfolio design that complements, rather than
redoubles, the risks already inherent in the client’s life. In many instances, these
considerations lead to individualized choices of sector allocations for client
portfolios.
Central to TIA’s investment approach is the conviction that, unlike institutions,
individual investors each have unique needs and circumstances that should
influence their investment choices. Accordingly, while TIA applies a uniform
process to the design and management of client portfolios, this process uses
inputs that are unique to each client. As a result, each client’s portfolio is unique,
and TIA manages each portfolio individually. Because TIA makes no effort to
“time” the market, on any given day the focus of portfolio management and
trading activity is likely to be the rebalancing or initialization of one or a small
number of client portfolios. Due to the nature of the rebalancing and portfolio
management discipline, it is not at all unusual for TIA’s activity one day to
consist largely of buying stocks for one portfolio on one day, but selling stocks
for another portfolio the next. The same is true at the level of individual stocks
— it is not uncommon for TIA to buy a particular security in one client’s
portfolio on one day, and sell it from another client’s portfolio the next.
TIA also seeks to design client portfolios to be advantageous from the client’s
particular tax point of view. Tax considerations inform both initial portfolio
construction and ongoing portfolio management. When new clients bring
existing portfolios, the tax position of the existing holdings can have an
important impact on the resulting portfolio. Many times TIA’s structured
approach can preserve existing portfolio holdings carried at a capital gain,
avoiding the need to create taxable events in restructuring the portfolio. On an
ongoing basis, a judicious program of tax management can also defer taxation,
often for significant periods.
PORTFOLIO CONSULTING.
By its nature, TIA’s Portfolio Consulting service includes significant elements
that vary according to the particular client’s circumstances. The principles TIA
applies in tailoring Portfolio Consulting services are similar to those we apply in
Portfolio Management.
SERVICES FOR INVESTMENT PROFESSIONALS.
These services involve the direct application of Dr. Tiemann’s expertise to the
specific problem at hand.
D. Wrap fee programs.
TIA does not participate in wrap fee programs.
E. Client assets.
As of February 29, 2024, TIA had discretionary management authority over
$302.89 million in client assets in 121 portfolios holding assets in a total of 312
accounts.