WHAT we do and HOW we do it is what really sets us apart as a successful investment advisory service.
Our approach at Clausen Capital Management has one overriding principal - Don't Lose Money!
It is a fact that a 50 percent loss in the market requires a 100 percent gain to recover your original principal. For example, if you have one dollar and lose 50 percent, you have only 50 cents remaining. To regain your original one dollar, you must have a 100 percent gain - you will have to double your money. As an investor, think how long it takes to double your investments in the markets.
From March of 2000 to October of 2002, the markets have lost in excess of 50 percent. Where would your investments be today if you had not experienced that decline? That is why at Clausen Capital, we have made it Rule #1 to NOT lose money
How do we do this?
  • We analyze the markets daily, constantly measuring market risk.
  • We actively manage all client accounts but do not hold custody of any client assets.
  • Our disciplined investment style lowers risk and prepares for the unexpected.
  • We set clearly defined objectives and methodologies.
  • We offer unbiased professional investment advice.
  • We invest in mutual funds that offer no loads or redemption fee.
We believe in our methods and investing style so much that the employees of Clausen Capital Management invest 100 percent of their personal funds in the exact same portfolios as our clients. It is, therefore, clear to see we have a vested interest in the success and growth of our portfolios. In a very real sense, we share in the same returns as our clients. When you make money, we are making money as well.
Top of Page
Daily Analysis
Successful investing demands full-time attention. Every business day, we analyze the markets and every fund we hold in every client account. That means we review daily each fund we hold in our portfolios to ensure that the fund is still performing as expected and to confirm that it is still meeting our investment objectives.
We also perform daily technical reviews of the major U.S. Indexes, Domestic Funds, International Funds, Bond Funds, High Yield Funds, and the Dollar because we know that this hands-on analysis is required to be proactively involved in our clients' investments.

By daily analysis of data at the close of the markets, we are able to assign a market risk level and make successful decisions based on those risk levels. Our goals are always two-fold - to make money AND to reduce the volatility of client portfolios
Measuring Market Risk
There are many forms of market risk for investors - real and psychological. There is the risk of not following an investment plan, the risk of following emotions, and the risk of not taking a risk.
Investors cannot avoid market risk but they can control market risk. Market risk can be measured, and we assign a score to market risk daily. This is not to say we can look into the future and predict when market risk will be in our favor - quite the contrary. But we can use the trending daily market risk scores to determine when market risk is in our favor or not in our favor.
Risk is many different things to many people. Statistically, it is the probability of a negative outcome and using standard deviation. In other words, it is a measure of volatility. In our world, market risk is the average of a number of analytical technical tools to view market movements, volatility, volume, and dominance.
No market moves up every day. Studies clearly show markets move in cycles. Our studies indicate that markets are moving in a general up-trend about 65 percent of the time. During that time, the markets are generally in a favorable environment for investors and market risk is manageable. But for the remaining 35 percent of the time, markets are generally in significant decline and market risk is high and often uncontrollable. The question is how to measure market risk and understand when market risk is manageable or in significant decline.
For Clausen Capital Management, we have assigned market risk a 1-10 scale, with One (1) being High Risk and Ten (10) being lowest risk. Obviously, there is never a time when there is no risk in the markets. It is our policy to move into the markets when over 75 percent of the current market risk is in our favor. While this is a very conservative approach, it has proven itself over and over. We have consistently participated when the markets are advancing and we have consistently protected client assets during periods of significant market risk and declining markets.
There is no patented answer that provides 100 percent accuracy when measuring risk, just statistical probabilities of success or failure. There are no mechanical signals that work to measure market risk. Mechanical signals will break down at some point. Measuring market risk involves time-consuming daily analysis coupled with disciplines and strategies.
In summary, measuring market risk allows us to understand whether the market is in decline or rising. It also allows us to understand a market that is in transition and the direction that market is moving toward.
Top of Page
Actively Managing Your Investments
Your investments are your own in every sense - we just treat them as if they were our own.
We spend considerable time every day evaluating and measuring market risk. The objective is to understand the daily strength or weakness of both domestic and international equity and bond markets. From that information, we assign a daily market risk score to determine if market risk is in our favor or not.
Clausen Capital Management is tactical in our investment philosophy. We position our clients in the best performing funds within the best performing sectors when the markets are in our favor.
We use active asset allocation and participate in the markets during periods when the markets are rising. In fact, we will overweight portfolios in areas that are performing best in the market place and underweight those areas that are performing poorly. We will stand aside to preserve assets during periods of significant market decline.
Daily, we evaluate a wide variety of domestic and international markets to provide ourselves an overall insight on market direction and performance. In addition, we evaluate each and every fund we hold in our portfolios against eight separate performance criteria. The funds held within the portfolios and the portfolios themselves are designed to address four levels of investor risk - from risk-averse investors interested in capital preservation to risk-aware investors who understand and accept increased levels of market volatility.
Defined & Disciplined Investing
If not now, when? We at Clausen Capital say "let us invest for you now" because we know that successful investing is a disciplined, continuous commitment - a commitment we have made and continue to make every day.
Clausen Capital Management understands the value of a disciplined investment style and how it positively impacts investment performance. By establishing tested rules and procedures, we can account for a wide range of possible market scenarios. Although it isn't possible to account for every eventuality in the markets, we reduce the impact of daily market changes.
A disciplined approach also sets rules to address how much or how little market risk to take depending on the specific market environment. Through discipline, we have set clearly defined objectives and well-established methodologies to determine market conditions and trends. We continuously review and analyze our information to determine those areas of the market with the most advantageous risk-adjusted reward for our clients.
We do not use mechanical market timing systems. Rather, our models include technical analysis and have gone through extensive back testing, using both real and hypothetical data for not less than 10-year periods.
We make no predictions regarding market direction or market activity. Instead, we concentrate on understanding market trends and the level of market risk.
This constant monitoring, adherence to established discipline, and clear methodology allows Clausen Capital to makes decisions about when to invest without procrastination - continually and effectively.
An integral part of our success in investing is research. For example, our understanding of specific funds' characteristics provides us an initial buy list of fund families when the market risk is reduced to the point that warrants market entry. We have researched approximately 5000 funds and excluded those funds that do not meet our initial buy criteria. This leaves us with a high quality family of about 200 to 300 no-load mutual equity funds covering the entire range of growth potentials, risk levels, volatility, and domestic and investment focus.
We constantly perform "post mortem" reviews of our fund purchases after each buy and sell period to critique our decision-making process and our established investment disciplines.
Objective Partners Working for You
We are the "manager" of managers. As objective and diligent observers of the markets, our most important service is to provide unbiased, professional investment advice to clients. We are a Fee Only Registered Investment Advisor, which means we do not receive brokerage commissions or underwriting fees from any other organization. Our compensation is linked directly to the results achieved by the management and performance of our clients' portfolios.
Thus, in a very real sense, Clausen Capital must be an objective and diligent observer of how well mutual fund managers perform their own jobs.
We do this by taking a two-year track record of the performance of a specific mutual fund and rank it against other funds with similar investment philosophies. We then compare the mutual fund for performance and volatility against its peers and measure it against market indexes. Those managers that outperformed their peers in risk-adjusted return become our potential purchase candidates when market risk is in our favor.
Additionally, Clausen Capital always looks for investments in no-load mutual funds. Each fund purchase is carefully researched to ensure there are no loads or redemption fees attached to the fund and each fund is selected only after passing a number of technical and visual validations. We also use Exchange Traded Funds when market risk dictates.
In summary, Clausen Capital Management makes it a point to always invest on behalf of our clients in no-load mutual funds where those mutual fund managers have a proven expertise, a successful performance record, and a long-term commitment to the fund(s) they manage.
 
 
 
 
 
   
SETTING CLAUSEN CAPITAL APART FROM THE REST