Why Passive?

Introduction to Passive Capital Management

Founding And Background

Passive Capital Management, LLC is a fee-only Registered Investment Advisor (RIA) founded in 2007 by Jonathan Farber and Scott Reinhardt, whose core conviction was finding a “better way” than the over-complexity and bad incentives of Wall Street. Having previously worked at more traditional, commission-focused brokerage firms, such as Alex. Brown and Sons, Deutsche Bank, and Wachovia, they were inspired to bring objectivity, trust, and great service back to investment advisory and financial planning.

Much has changed since then, but PCM’s simplified approach focused on transparency and controlling what matters, has stood the test of time. As of 2024, Passive Capital Management had eight employees and over $850 million in AUM. Not only have we grown the size of our business, but we have also built a deep team of professionals constantly striving for “better” for our clients: we have three Certified Financial Planner’s (CFP®), three Chartered Financial Analysts (CFA) and one Chartered Retirement Planning Counselor (CRPC) professionals. While our roots will always be in Investment Management, these additions have allowed us to offer our expertise to a wide array of client backgrounds.

We prioritize close relationships with our clients to ensure we are with them at every step of their financial planning process. This conviction and belief in investment advising that listens to our client’s needs first and then builds the portfolio led to and has maintained PCM’s success.

Core Conviction

“At the core of Jonathan and Scott’s vision is the recognition that investment returns are generated by the capital markets themselves, not by products or professionals.”

PCM’s Philosophy

  • Client-Centric Approach

We are a fee-only Registered Investment Advisor (RIA) and, hence, obligated to act as fiduciaries. Any advice we provide you is focused on what is in your best interest.

  • We listen to our clients, understand their unique and specific needs, and then tailor a portfolio that provides them with the highest chance of a successful investment experience.
  • We educate our clients through every step of the investment process, manage their expectations, and provide peace of mind by handling everything thoughtfully and thoroughly.
  • We are transparent and confident you won’t experience any surprises.

Since we do not accept commissions or any compensation from investment product companies, our clients are assured that our interests remain aligned with theirs

  • Portfolio Structure

When constructing our client’s portfolios, we examine their goals, risk tolerance, and time horizon.  We also take into account considerations such as taxes, multigenerational planning, and operating needs (for non-profit clients).

We utilize low-cost, globally diversified, tax efficient investments that are consistently exposed to all global asset classes. These may include mutual funds, exchange traded funds, and index funds.

Focus On What You Can Control

We choose to focus on factors we can control, instead of hoping for results we cannot control to deliver reliable service and keep your investments from unnecessary risk and cost.

Key Areas of Focus

Customer service

We are available and responsive; prioritizing clients’ needs and acting in their best interest (you won’t get an automated phone tree here!)

Discipline

We aim to keep our clients in their “investment seats”, not letting day-to-day headlines or the current “financial chatter” shape our approach to investing

Asset allocation

In building and rebalancing portfolios we abide by a client’s Strategic Target Asset Allocation to drive our decisions

Diversification

Spreading investments among different asset classes to minimize risk

Tax efficiency

Understanding each client’s unique tax situation and utilizing tax-efficient investment vehicles and tax-loss harvesting when appropriate

Costs

Maximizing portfolio returns by keeping costs as low as possible

Avoidance Of Speculation

Passive Capital Management avoids speculating with your money. We do not attempt to predict the future by guessing but rather control the controllable factors. As such, we prioritize a long-term, prudent investment strategy that captures market returns.

We don’t have a crystal ball, and neither does anyone else.

Commitment To Client Success

Investment Experience

As fiduciaries and through our approach, as outlined above, we believe our clients have very good odds of enjoying a long-term, successful investment experience.

Confidence in Strategy

Each year, 100’s of mutual fund portfolio managers, through active management activity, fail to meet their relevant benchmarks. It only gets worse as time goes on.

In doing so, they considerably reduce their clients’ returns on investment. By owning the global capital markets in their entirety, and staying disciplined while being as cost-conscious as possible, we believe we offer clients the best chance of enjoying a successful investing experience.

PCM’s Approach

We aim to capture the returns of the global capital markets, whenever and wherever they may occur. By focusing on this and eliminating speculation, we generate more reliable outcomes and fewer surprises for our clients. Our clients know we work for them, giving them peace of mind that we are a partner in their financial journey for years to come.

To learn more about PCM and our investment philosophy, please call (315) 478-3130 for our Syracuse office and (443) 275-2703 for our Baltimore office.

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