Photo: Igor Ovsyannykov. Source: Fancycrave
I remember buying my first tailored business suit. I was scared that I would just waste my money. The suits seemed out-of-reach, but I had scraped together my modest savings to have more than a basic “interview suit” – the suit I had purchased with my mom my senior year of college, that was now so easily rumpled that it made my co-workers think I had been sleeping in it.
The salesman guided my choices, whispered the price they would accept – vs. the price on the tag – and made me feel a little less uncomfortable. But I felt as out-of-place in a tailor-made suit as bald man in a revival of “Hair.” After I had made my choice, he ushered me over to the tailor – who measured and wrote and figured and re-measured and wrote again. I had no idea what he was calculating or what his mysterious marks and tools did, but I trusted he knew what he was doing. His shop had been highly recommended – by my boss.
Photo: Adonyi Gabor. Source: Pxhere
There are three types of custom tailoring: alterations, made-to-measure, and truly personalized suits. Alterations take an off-the-shelf item of clothing and change the hems, sleeves, and other dimensions to fit your body. Made-to-measure clothes take your measurements first, then use a machine to cut a pre-existing pattern within specified options and choices. Ralph Lauren’s “Purple Label” is a made-to-measure brand.
Getting truly personalized, bespoke clothing is much more involved. The pattern is made just for the client and cut from scratch. It usually requires several fittings as each piece is adjusted and modified along the way. The options are only as limited as your imagination. You get your style done your way with your choice of color and fabric. There are shops in major cities around the world. I used to see ads for “Hong Kong Suites” in our local newspaper – a firm that would set up shop in a local hotel suite several times per year and schedule times for clients to come in for their measurements and fittings. Hong Kong was famous for its tailored suits back then.
The market for investments is a lot like the market for clothes. There’s off-the-rack, customized, and fully bespoke management options. Investments off-the-rack are like mutual funds and index funds. They do the job, but they may not fit your goals or concerns very well. That’s why so many people have a hard time sticking with their choices. Customized investment plans are a notch higher. They use an interview process to choose from a pre-selected array of investment models. The modeling process can seem mysterious, though – like a black box – and it’s not always clear what the questions are designed to do.
Fully bespoke investment portfolios are designed and structured to satisfy a client’s return objectives, their ability to take risk, their time-horizon, legal structures, tax situation, cash needs, and other considerations. Some folks want to avoid companies involved with tobacco or processed foods or oil. Others just want to underweight those holdings. Customized investing involves sitting down with a professional – often several times – to talk about what you want and need. It’s a process that should adjust to you as your circumstances change as well.
Our portfolios are at least as important as our clothes. They may not make us look better, but they should be tailored to fit our present and future requirements and stay within our risk-budget. Risk – in the form of volatility and uncertainty and potential for loss – is the price that we pay to get the returns we want.
In the end, I picked up my suit when the tailor had it ready, and it lasted for many years. And I learned a lot in the process: about clothes, about tailors, and about myself.
Douglas R. Tengdin, CFA
Charter Trust Company
“The Best Trust Company in New England”