Conley Capital is essentially an asset manager – we help people decide what to invest in and when. We also do some financial planning for clients from time to time, especially when establishing a new relationship. However, most financial planning is reasonably straight-forward and readily available from many sources. The tough part is picking and managing the investments. Our work focuses on determining what offers good value. In other words, we look for what seems cheap at any given time, adjusted for risk and historical context. This often turns out to be something different than most people are currently recommending or buying. We accomplish this by tapping into a network of contacts and sources established over 35 years. We also do extensive reading and research. Much of this happens outside of what most people would consider “conventional” sources or “normal” channels. Because we are not constrained in either thinking or investment choices by large brokerage houses, insurance companies or financial planners’ research and product restrictions, you will often find that our ideas are somewhat outside the mainstream. What Conley Capital might suggest may not seem very comfortable to you at first, but because things are seldom what they seem, our ideas often will make sense after you understand and carefully consider the thinking behind them. That being said, they don’t all work all of the time, so carefully evaluating risk is an essential part of our process.

In reality, most investment advice today has its roots in work that originated at the University of Chicago in the 1970s. The Chicago school assumes that markets are rational and efficient because the participants are “rational acting profit maximizers”. In other words, people behave rationally and always act in their own self-interest. However, we believe this is simply not true because markets are made up of people. From the newest neophyte to the most experienced portfolio manager, they all make decisions in emotional ways. If we are correct then the Chicago school of thought, called Modern Portfolio Theory, is largely wrong. The result is that most research, investment advice and recommendations available today simply don’t work very well; in fact, they can be downright dangerous to your financial well-being.

At Conley Capital we believe emerging research in Behavioral Economics better describes how markets function and people behave when making investment decisions. We think we live in a “Reversion to the Mean” world. In simple terms this means that from time to time people’s emotions cause the price of various things to get far too expensive; at other times fear causes them to get way too cheap. Eventually, however, prices return to “fair value” or do what’s called “revert to the mean”. Our 35 years of experience tends to validate this point of view. However, we also know we can be subject to the same emotions. The difference is that we realize this and take it into account when analyzing investments and recommending them to our clients. We apply the same thinking when investing, and sometimes speculating, for our own personal accounts.

Conley Capital does not manage money under power of attorney. Further, we believe that a certain amount of client participation in the decision-making process is essential to the long-term success of everyone involved.