a new way to look at investing

1. A New Way to Look at
Investing
PRESENTED BY NASSER BARAKAT

2. About Nasser Barakat
• Series 65 licensed Investment Advisor Representative (IAR)
• Financial advisor at Partnervest Advisory Services LLC
• Works closely with some of the most established advisors in the industry
• Specializes in wealth preservation and multi-level diversification

3. About Partnervest
Partnervest Financial Group was created to provide unbiased
investment solutions for advisors and their clients. The firm uses
state- of-the-art alternative strategies and investments to create
portfolios designed to generate income and manage risk.
At Partnervest the principals have over a century of combined
experiences in all aspects of investment management. The firm
is proud of its flawless reputation, creative thinking and
entrepreneurial spirit.

4. Wealth Preservation

5. Wealth Preservation
• Think of yourself as the head coach, and your wealth as your team.
• Every sport requires a defense and an offense. It is your job as the head coach to try to
have the best possible combination of offensive potency and defensive grit in order to
succeed.
• So how do you as the coach strike the perfect balance?
• And how does this relate to your money?

6. Wealth Preservation
A look into sports history
• In the 2014 Super Bowl it was a match up of the leagues most potent offense in the Denver
Broncos versus the leagues toughest defense in the Seattle Seahawks, both being of
historical proportions.
• Denver was heavily favored to win, yet Seattle ended up shutting down Denver’s offense, leaving
them with nothing. The final score being: 43-8 in favor of Seattle.
• The Phoenix Suns of 04-06 had some of the most potent offense the NBA had ever seen,
which is still true till this day.
• Despite having arguably the most potent offense in league history, each of those three years,
they were eliminated at the hands of a defense orientated team.

7. Wealth Preservation
“Offense sells tickets, but defense wins
championships”
-Bear Bryant
The same is true for your investments

8. Wealth Preservation
How it has looked when a little offensive fire power was sacrificed for a more solid defense.
(foxbusiness.com)

9. Wealth Preservation
What you will notice in this hypothetical comparison is that the growth wasn’t always as
great as the S&P 500.
 For example, for the year 2009, the S&P went up 28% while this investors account only went
up 15%
But what you will also notice is this investor’s losses weren’t as great as the S&P due to an
impeccable defensive strategy.
 Look at the year 2008 when the stock market crash happened. The S&P went down nearly
41% while this investor’s account did not move from the previous year, sitting at 0% for that
year.
By 2010 for this investor, there was about a 110% difference between his current defense
orientated account versus what it would have been if it was an all out offensive strategy,
which in this case, would be putting all of his/her assets in the S&P 500

10. Wealth Preservation
• Nasser specializes in investing strategies designed to provide wealth protection
while at the same time allowing for the potential to achieve growth.
• Though there are different defensive strategies, one commonly overlooked
strategy is in the use of options.

11. Wealth Preservation
Options can provide protection (defense) while at the same time
providing the investor with potential revenue (offense).
Option: A contract to buy or sell a specific financial product. The contract establishes a
specific price, called the strike price, at which the contract may be exercised, or acted on.
It also has an expiration date. When an option expires, it no longer exists or has value.
Strike price: The price at which a put or call option can be exercised. (Oxford Dictionary)
• Options are purchased for a premium

12. Wealth Preservation
Different types of options include:
Calls: The purchase of a call gives the owner the right, but not the obligation, to buy the
underlying security at the strike price on or before the expiration date. In turn, the seller of the call
is required to sell the security at the strike price at the buyer’s request.
Puts: The purchase of a put gives the owner the right, but not the obligation, to sell the
underlying security at the strike price on or before the expiration date. In turn, the seller is
required to buy the security at the strike price at the buyer’s request.

13. Wealth Preservation
What’s in a name?
When dealing with options, it gives you, well, options!
 Having the option available to either buy or sell at a predetermined price gives you and
your resources more control and more predictability.
 It can be used to hedge against loss while at the same time providing an income stream.
Most importantly, you are enforcing a defense orientated strategy for your
portfolio.

14. Wealth Preservation
• Options are just one form of defense, or protection, and are versatile in nature.
Hence, why most investors should consider adding the use of options to their
portfolios.
• Everybody’s situation is a little different, therefore it is important to consult
with Mr. Barakat about which strategy would be most appropriate for you and
your goals.
Consultations are always free

15. Multi-Level
Diversification

16. Multi-Level Diversification
• Traditional diversification involves a portfolio of mixed securities and investment
classes designed to lower the risk of your portfolio. And it is absolutely necessary to a
prudent investor, but is only one facet of true diversification.
• Many investors don’t think about diversifying in the different ways your money can grow
along with how your investments are taxed.
• These are all important considerations as these strategies play a big role in the
over-all performance of your portfolios as well as how much of it you can keep
and how much of it you would have to pay to Uncle Sam.

17. Multi-Level Diversification
Three main growth strategies:
• Fixed: Money grows at a fixed rate regardless of external
factors.
• Variable: Money growth and loss varies in direct
correlation of an underlying security or index. Variable
accounts most commonly correlate to the performance of
the stock market.
• Fixed-Indexed: A hybrid between a fixed account and a
variable account. Has the potential to grow with the
underlying security or index yet has the safety of a fixed
account. The caveat is in its limitations. This strategy
usually involves a cap (growth limit).
Pros Cons
Less Risk Low-Yield
More
Predictable
Bull Market
Bear Market
Pros Cons
Often Higher
Yield
More Risk
Historically
successful
Strategy
Unpredictable
Bull Market Bear MarketPros Cons
Less Risk Long Term Strategy
Growth Potential Multiple Fees
Capital
Preservation/
Bear Market

18. Multi-Level Diversification
But It’s Not What You Make, It’s What You Keep.

19. Multi-Level Diversification
• The most commonly used investing strategies often involve the highest
levels of taxation, they aren’t very tax efficient.
• Tax efficiency is simply measured by how much of an investment’s
return is left over after taxes have been paid.
• We must first figure out how your current portfolio is structured under
the law as well as your current tax bracket in order to see how we can
reposition assets to maximize efficiency, and ultimately maximize your
returns.

20. Multi-Level Diversification
Three main forms of taxation:
• Tax Now: Investors pay taxes on the growth of their
investments the same year. The usual tax rate is any where
from 10% to 39.6% depending on your tax-bracket.
• Tax Later (Deferred): Investor’s accounts are sheltered from
taxation so long as money goes untouched for a specified
amount of time. “Pre-tax dollars” are being paid into the
account. During the withdrawal period, withdrawals are taxed
as ordinary income.
• Tax-Free: Paid with “post-tax dollars”. Contributions are not
tax deductible. Growth on investments are not taxed. During
the withdrawal period, withdrawals can be made tax free.
Accounts May Include:
Corporate Bonds
Bank CDs
Money Market Funds
Accounts May Include:
Municipal Bonds
Roth IRAs
Life Insurance
Accounts May Include:
401(k)s
403(b)s
Most IRAs

21. Multi-Level Diversification
• Given these different taxation methods, the seemingly logical thing to do is to put as
much as possible of your portfolio in a tax-free kind of investment.
• This won’t always be true. Analyzing your tax situation is a huge part in customizing a
portfolio that is tailored to your needs.
• As with everything, each method has it’s virtues as well as it’s downfalls. For example, if
the tax advantages of a qualified tax deferred plan will move you into a lower tax
bracket, then it should really be considered.

22. Closing Thoughts

23. Closing Thoughts
There are many similarities to managing a sports team and managing
investments. With both, defense has been, and continues to be the most
underrated attribute.
It may not be flashy and at times could look ugly. But history will tell you time
and time again, defense is a powerful and successful strategy. Defense wins
championships.

24. Closing Thoughts
There is a multitude of different investing strategies and a multitude of
different investments.
It is on you the investor, to partner up with a knowledgeable and like-minded
advisor to help you maximize your gains with the primary focus in
minimizing your losses.
It is on you the investor, to take a risk-free opportunity of a second opinion
from a qualified professional advisor in Nasser Barakat.

25. Contact Information:
Nasser@NasserBarakat.com
or
NBarakat@Partnervest.com
(805) 416-6190

26. Important Disclosures
• Investment Advisory Services provided through Partnervest
Advisory Services, LLC. Insurance products sold through Life and
Annuity Masters Inc. This presentation is designed to provide
educational and/or general information and is not intended to
provide specific legal, accounting, investment, tax or other
professional advice. For specific advice on these aspects of your
overall financial program, you will need to consult directly with
Mr. Barakat. There is always a possibility of loss as well as gain with
any investment strategy.