Get to Know WBI | About Our Leadership, Our History, Our Philosophy

Our Mission:
Grow & Protect Capital

We believe preserving capital to unleash the powerful benefits of compounding is the most important element of a successful investment approach. That’s why we have spent nearly 35 years focused on building best-in-class retirement solutions for investors. Our unique, comprehensive wealth-management strategies aim to help investors achieve their life and wealth goals. Founded in 1984, WBI seeks to TAME THE BEAR and RUN WITH THE BULL.

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Our Mission:
Grow & Protect Capital

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Our Mission:
Grow & Protect Capital

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Our Mission:
Grow & Protect Capital

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Our Mission:
Grow & Protect Capital

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Our Mission:
Grow & Protect Capital

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Our Mission:
Grow & Protect Capital

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Our Mission:
Grow & Protect Capital

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Our Mission:
Grow & Protect Capital

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Our Mission:
Grow & Protect Capital

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Our Mission:
Grow & Protect Capital

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Our Mission:
Grow & Protect Capital

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Our Mission:
Grow & Protect Capital

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WBI is a company of values, commitment, and loyalty to our employees, clients, and our community.

We are fiduciaries which means our clients’ interests come first. We take what we do for our clients seriously, because they cannot afford to have us make mistakes. Our goal is to add value to each client situation significantly greater than the cost to retain us through product innovation and attracting and retaining a talented team. At WBI, we are committed to giving back to our community and take pride in our employees’ volunteerism.

TAME THE BEAR. RUN WITH THE BULL.

“An investment in knowledge pays the best dividend.”

–Benjamin Franklin

Returns Aren't Everything

One of the great illusions of investing is that returns are everything - they’re not. We believe returns only play a minimal role in a winning investment strategy. To unravel the illusion, let’s take a look at this example. While it may be a little extreme, it shows that extreme conditions may yield extreme consequences.

Let’s say you have $1,000,000 to invest and you have two investment managers to choose from - one has produced an average annual rate of return of 5% and the other a 33% average annual rate of return. Many people would naturally gravitate toward the manager that produced a 33% return.

Manager A achieves an average rate of return of 33% over three years. In year one, the $1,000,000 increases by 99% to $1,990,000. In year two, the account declines by 99% to $19,900. In year three, the account increases again by 99% to $39,600. While the manager achieved an average return of 33%, the account declined by 96% in value.

Now look at Manager B who produced an average rate of return of 5% over three years. Which would you choose? We believe high returns are often an illusion, what is real is the amount of capital you can maintain in both good and bad markets.

Investors often focus on annual returns to make investment decisions without understanding that the sequence of returns, gains and losses, can significantly impact their capital and overall investment success. Annual returns can trick investors into thinking that published returns are consistently achieved, when they are not.

Buy & Hold is Flawed

Buy and hold is a strategy often recommended to help investors stay invested to maximize positive returns in bull market cycles. Unfortunately, buy and hold can also expose investors’ capital to negative returns and big losses during bear market cycles.

We have observed that many investors can tolerate short-term losses of 5%, 10%, 15%, or even 20% before they feel compelled to adjust their portfolio holdings. When they abandon their investment plans by selling into declining markets, they “sell low” not high. If capital losses are large enough, investors run the risk of compromising their retirement goals. This propensity to buy high and sell low while trying to follow a buy and hold approach is the exact opposite of what we believe is required to achieve success.

We have found that performance can be enhanced dramatically by raising cash to PROTECT CAPITAL from large losses as price trends turn bearish rather than staying fully invested in the hopes of not missing return. If you lose 50% of your capital how much return to do you need to get back to even? If you said 50%, you’re mistaken. You wouldneed a gain of 100% just to get back to where you started.

In our experience, investors who try to use a “buy and hold” strategy actually end up with a “buy and fold” experience as bear markets pile up larger losses than they can tolerate. When you deplete your capital, its very difficult to get returns that are high enough to recover your losses, much less reach the rate of return you need to enjoy your retirement.

“Compounding is the eighth wonder of the world.”

–Albert Einstein

Capital Matters

Since 1900, a market decline of 10% occurs on average once every year, 15% every two years, 20% every four years and 40% every six years.¹ From the 2007 market high to the 2009 low, the Dow Jones Industrial Average declined 53.78%. For many years, investors have been taught that if you try to avoid large losses, you will miss the 10 most powerful positive days of return. Without those days, so the 1970s buy and hold theory says, investing is not a worthwhile endeavor. We believe this is not the full story.

Years ago, in an effort to find a better way to invest, we refocused the concept to see how the 10 best or worst quarters affect an investor over a lifetime of investing. If you were to buy and hold a hypothetical investment of $100,000 in the Dow Jones Industrial Average from 1950 through 2018, the investment would have grown to $11,656,154. However, your success — relative to buy and hold — would have been greatly hampered by missing the 10 best quarters, ending with a disappointing capital balance of $2,286,627. Surprisingly, by missing the 10 worst quarters, $100,000 invested would have grown to over $80 million. As it turns out, missing the worst quarters was 7 times more powerful than a buy and hold approach. Even if you gave up the 10 best quarters to miss the 10 worst quarters, you would have ended the period with $16,278,855 or 40% more capital than the buy and hold approach.

The results from our original best and worst quarters study, performed over 30 years ago, formed the basis for WBI's approach to investing. For over 25 years, our goal has been to help investors have more successful outcomes.

Benefits of Dividend
Paying Stocks

Dividends can be a powerful factor in creating long-term outperformance.

Companies tend to increase dividends over time, which can increase investor income to keep pace with rising lifestyle costs due to inflation. Over full market cycles, stock price appreciation and dividend income can boost long-term performance. Historically, dividend-paying stocks have been less volatile and experience less downside loss than non-dividend paying stocks in bear markets. Most importantly, reinvested dividends can promote compounding and accelerated capital growth.

Past performance is not indicative of future performance

Dividend Payers Outperform

Most investors don’t realize that dividends account for the 42% of the S&P 500’s historical average rate of return.² Dividends can help to provide: rising income, price appreciation, compounding, dollar-cost averaging, and less volatility. In the chart below, the categories are defined by a company’s dividend policy.

Cutters: includes companies that lowered their existing dividend or stopped paying regular dividends during the preceding 12 months
Non-Payers: companies that don’t pay dividends
No Change: companies that pay dividends but did not have a change in policy
Payers: all companies that pay dividends, regardless of policy changes
Growers: includes companies that raised their existing dividend or initiated a new dividend during the preceding 12 months.

Dive Into Dividends

Dividends Can Unleash Powerful Investment Forces
#1: Compounding- Compounding enables an investor to build shares as dividends are reinvested to buy more shares each quarter.
#2: Dollar Cost Averaging- This entails systematically investing money over a long period of time, such as reinvested dividends monthly or quarterly.
Reinvested dividends and the benefits of compounding can have a dramatic effect on your investments. Systematically reinvesting dividends can help risk adverse investors buy low, something rarely done during high-risk periods. This can also lead to lowering the average purchase price as stocks’ share prices fluctuate. The lower the share prices, the more shares you can purchase.

Dividends Can Break the Mold of Traditional Buy and Hold
Buy and hold theorists suggest that investors can’t time the markets. They believe that positive returns generated during market up-trends will always be sufficient to allow investors to generate high returns and recover lost capital. By avoiding the down days, theorists insist investors will miss the few major up days that provide the most return.

What if investors held stocks that provided return from price appreciation and dividends? You can bank on the return you will get from dividend payments. Dividends generally arrive every quarter. The best part? You do not have to sell a stock to get the dividend. Once received, the dividend can be reinvested and used to diversify your portfolio or generate income. This breaks the mold of the typical “buy high, sell low” investor behavior.

Dividends Can Provide Inflation Fighting Protection
#1: Price Appreciation- Price appreciation can increase capital balance. Market history reveals that the return from growth in share price appreciation alone does not justify investing in volatile equities. It is important to utilize the persistent cash flow from dividends to stay invested in both good and bad market cycles.
#2: Rising Dividend Income Streams- As companies periodically increase dividend payments to shareholders, dividend income streams rise.

Dividends Can Win Big in Bull and Bear Markets
Human survival instincts tell us to get out when the market drops. With a focus on dividend paying stocks and a responsive methodology that seeks to conserve capital in down market losses, investors can still win big in both bear and bull market cycles. Cash flow from dividends allows investors to stay invested during both good and bad market cycles.

Dive Into Dividends - Part 2

Incorporating dividends in your portfolio can help provide downside protection in bear markets, thus increasing the potential to build more consistent capital. Having a large capital base can, in turn, enhance growth and income.

Historically, between 40% and 50% of the return that investors associate with investing in stocks has come from dividends, with the balance being earned through price appreciation.³ Rising returns from dividends can provide a predictable source of return that pays investors to wait patiently for price appreciation to reaccelerate and bull market conditions to return to equity markets.

Let's take a look at a historical market trend that exemplifies return from dividend paying stocks. A hypothetical $100,000 invested on Jan. 1, 1988 in an investment that performed similarly to the Dow Jones Industrial Average-(DJIA) would have grown to $1,203,172 exclusively from price appreciation by 2018. Over the same time period, a hypothetical $100,000 with dividends reinvested would have grown to $2,630,980.

Even over a much shorter period of time — and during the second worst bear market in history — compounding with reinvested dividends provided positive results.⁴ From 2000-2018 alone, a hypothetical investment of $100,000 in an investment that performed similarly to the DJIA would have grown from price appreciation to more than $202,000. Over the same period, a hypothetical $100,000 with the dividends reinvested would have grown to about $319,000.

In order to reach important life and financial goals, you may want to consider investing in dividend-paying stocks. Price appreciation over time can enhance growth, especially when reinvested dividends are steadily increasing share balances. According to research, bear market cycles tend to appear every 6 years.⁵ The current bull market cycle has been running for 10 years. Will you be ready for the next market cycle? We believe increasing dividend paying stocks during market cycles will help preserve capital.

To learn more about dividends, check out All About Dividend Investing by WBI Founder and CEO Don Schreiber, Jr. and Gary E. Stroik.

Different Processes for
Different Risk Levels

ACTIVE RISK-MANAGED
Combine time-tested, multifactor security selection models with our advanced dynamic trailing stop process to protect capital for conservative or moderate investors.

TREND SWITCH
Designed to give moderate investors simple solutions aiming to optimize bull and bear market cycles utilizing domestic stock and fixed income trend models.

POWER FACTOR
Unleash WBI's security selection power. These aggressive strategies offer stronger potential for capital growth and are suitable for aggressive investors.

WBIINVESTMENTS.COM/PROCESS

“Managing income products for clients in retirement is the hardest job a money manager has.”

–Don Schreiber, Jr.

The 3 Pillars of
Retirement Income

When managing income for clients in retirement there is no room for error. So how can investment managers create successful retirement income strategies for their clients? Our experience indicates the greatest financial risk facing retired investors is outliving their retirement savings.

Why Traditional Investment Strategies for Retirement Income Fail
Let’s look at a traditional retirement investment philosophy — the bucket strategy. The overarching idea of this strategy is to set aside a “cash bucket” for expenses while investing the remaining assets in an allocation of more volatile assets with potential for higher returns.⁶ An easy example: Nancy has $1 million to invest. Nancy needs 5% income from her investment portfolio, so the advisor sets aside $250,000 (25% of her capital) in a cash bucket. The advisor will typically use a money market account which can yield approximately 0.40% to 0.80% return.⁷

The remaining 75% of Nancy’s portfolio would be invested for aggressive growth. She would need to achieve a high rate of return to replace the 25% cash bucket depleted over five years, and would also need additional return to grow sufficient capital to allow income to keep pace with inflation. Traditional bucket theory would indicate that Nancy would not worry about the loss of capital she would see in her aggressive allocation during a bear market because she would be comforted by the income reserve in the cash bucket. In our experience, real investor behavior would indicate the opposite. Significant losses would likely cause Nancy to sell low in an effort to protect her capital — potentially a really bad idea. So what works?

The 3 Pillars of
Retirement Income - Part 2

WBI’s 3 Pillars to Success
Pillar #1: Reduce Loss of Capital - The first and most important pillar is managing risk to capital. Over any given year, the maximum loss we think a retired investor should take is about 10%. WBI’s Retirement Income strategies utilize our hallmark active risk-managed approach because we feel limiting normal bear market losses of 40% to approximately 10% should be the goal.

Pillar #2: Generate Income Withdrawals from Portfolio Interest and Dividend Cash Flows - The goal is to generate income as close to the client’s withdrawal rate as possible, so you are not dependent on liquidating underlying shares of the investment to distribute income. This can help prevent compound liquidation of capital caused by selling investments to fund income withdrawals as prices are falling.

Pillar #3: Generate Consistent Capital Growth to Allow Income Withdrawals to Keep Pace with Inflation - The objective is to capture enough capital appreciation when market conditions are favorable so that you can keep up with investor demands for more income when inflation robs them of their purchasing power. The challenge is that over time, investors need more income and their capital balances also need to rise so assets can be repositioned to generate more income. We believe an actively risk-managed portfolio using a balanced global blend of high-yield dividend-paying stocks and fixed-income securities can provide retired investors with the current income and capital growth they need to meet their goals.

The Bull|Bear Story

Since introduced in 2014, we have had hundreds of people ask about our unique logo. Here is the story of the Bull | Bear.

WBI believes to be successful at investing you must protect against large losses of capital to improve compounding and generate consistent capital growth.

The WBI Bull | Bear logo speaks to the dual nature of markets. Capturing return may look easy in bull markets, but in bear market cycles you can lose money much faster than you can make it back. The true test of any money manager is how they perform in good and bad markets. WBI’s hallmark active risk management focuses on protecting capital from devastating bear market losses to provide investors with a larger capital base to maximize up market capture and returns.

Our time-tested, risk-managed process targets the optimal blend of bear market capital protection and bull market participation. We believe this approach leads to more consistent capital growth and a larger capital base to maximize retirement income when investors need it the most.

IMPORTANT INFORMATION

Past performance does not guarantee future results. This is not an offer to buy or sell any security. No security or strategy, including those referred to directly or indirectly, is suitable for all accounts or profitable all of the time and there is always the possibility of loss. You should not assume that any discussion or information provided here serves as a substitute for personalized investment advice from WBI or any other investment professional. If you have questions regarding the applicability of specific issues discussed to your individual situation, please consult with WBI or your chosen professional advisor. This information is compiled from sources believed to be reliable, accuracy cannot be guaranteed. WBI’s advisory operations, services, and fees are in the Form ADV, available upon request.
The Bull|Bear strategy accounts are subject to investment risk, including the possible loss of principal, and include both Traditional strategies and Tax-Smart strategies. The ETFs in the Tax-Smart SMA program accounts may invest in other ETFs, mutual funds, and Exchange-Traded Notes (ETNs) which will subject the account to related additional expenses of each, and the risk of owning the underlying securities held by each. Investment risks may include but are not limited to: market, economic, political, interest rate, currency exchange, leverage, liquidity, credit quality, model, portfolio turnover, trading, REIT, high yield stocks, nondiversification, concentration, commodities, options, new fund, and client specific restrictions. WBI’s Passive ETFs are not actively managed and WBI does not attempt to take defensive positions in declining markets. The allocation to ETFs can provide increased tax efficiency over traditional SMA approaches. We believe the structure of the Tax Smart Program provides several benefits in addition to the potential for increased tax efficiency. However, Clients should understand that tax-qualified accounts, such as IRAs, do not benefit from any additional tax efficiencies of the “Tax-Smart” structure. Please consult with a tax professional prior to making investment decisions.
WBI has an inherent conflict of interest in investing in or recommending Affiliated ETFs as follows: 1) WBI and affiliates receive management fees from Affiliated ETFs. To avoid receiving two layers of management fees in situations where clients invest in Affiliated ETFs through SMA and Platform accounts, WBI will either: (i) waive the management fee at the account level; or (ii) credit the management fees paid by the Affiliated ETFs to WBI and its affiliates with respect to an account’s investments in Affiliated ETFs against the account-level advisory fees the account owes WBI, and 2) WBI’s affiliated broker-dealer, Millington Securities, Inc., receives compensation (including payment for order flow, commissions or other fees) for transactions effected on behalf of Affiliated ETFs. Trades WBI places through Millington will be subject to WBI’s duty of best execution and applicable law.
The process by which securities are selected and assets are allocated within WBI Power Factor SMA strategies, which are aggressive, will typically occur no more frequently than quarterly, which may cause accounts invested at different times during a quarter to reflect implementation of the strategies on a different basis than other accounts managed to the same or a similar strategy. The accounts may invest in and hold securities which are declining in value for an extended period of time, typically without taking a temporary defensive position, as part of the normal operation of the investment strategy.
During periods of high market volatility, a significant amount of holdings in the Trend Switch Strategies may be sold, resulting in a large allocation to cash or cash equivalents. At times, market conditions and the particular Portfolio Strategy, may call for an allocation of 100% to cash or cash equivalents. If the portfolio strategy invests all or a substantial portion of its assets in cash or cash equivalents for extended periods of time, including when it is investing for temporary defensive purposes, it could reduce the strategy’s potential return as the limited returns of cash or cash equivalents may lag other investment instruments in a strong market.
Although a company may pay a dividend, prices of equity securities – including those that pay dividends – fluctuate. Investing on the basis of dividends alone may cause an investor to buy or sell certain securities when circumstances may or may not be favorable.
You are not permitted to publish, transmit, or otherwise reproduce this information, in whole or in part, in any format to any third party without the express written consent of WBI Investments, Inc.

1 Schreiber, Don, Jr. “The Ugly Truth About Buy & Hold.” WBI Investments, 2018.
2 Ervin, Eric. “Q1 Market Update: Dividend Growth Outpaced the S&P 500.” Forbes. Forbes Magazine, 14 Apr. 2017. Web. 12 June 2017
3 Market Analysis, Research & Education (MARE) November 12, 2012
4 “Thomson Reuters.” N.p., n.d. Web. 20 June 2012. .
5 Shell, Adam. “Investors appear to dismiss some market risk.” USA Today. N.p., 2012. Web. 12 Oct 2012. story?id=17007195>.
6 Benz, Christine. “The Bucket Approach to Retirement Portfolio Construction.” Morningstar. 20 Mar. 2015. Web. 16 Dec. 2015. "Best Money Market Account for 2016 - The Simple Dollar." The Simple Dollar Best Money Market Account
7 Latham, Saundra. "Best Money Market Account for 2016 - The Simple Dollar." The Simple Dollar Best Money Market Account for 2016
Comments. 7 Dec. 2015. Web. 6 Jan. 2016.

Milestones

Founded

WBI was originally founded in 1984 as Wealth Builders, Inc. to be a leader in providing value-added financial advisory, investment management, and wealth management to individuals and institutions.

First products

WBI introduces the first of its proprietary separately managed account strategies. The strategies are designed to provide risk-managed capital growth aimed to produce the optimal blend of bear market capital preservation and bull market return.

WBI Begins Operating

The company offering investment management services and wholesale distribution begins to officially operate as today’s WBI, providing discretionary investment management.

Enter ETFS

WBI celebrate its 30th anniversary. In August, the company reached a historic milestone with the launch of 10 actively managed ETFs, setting an industry record by raising $1 billion in assets on the first trading day.

Year of Innovation

WBI brings 21 new products to market. Increasing market reach, WBI launches products to reach the masses utilizing all the tools of its investment management system and quant lab research from its nearly 35 years in business.