Global Tactical Asset Allocation

We start with a broad range of Global Asset classes selected to perform well in each of the economic regimes that we believe investors are likely to face in their lifetimes.That is environments of rising growth with either inflation or deflation or decelerating growth with either rising inflation or deflation.Then we apply a periodic filter based on momentum metrics and rather than hold the entire portfolio we typically select approximately four to six of the best performing asset classes. We then take these limited investable asset classes and apply a Naïve Parity Algorithm or Mean Variance Algorithm to maximize diversification.

This portfolio is rebalanced periodically and can also be leveraged to an investors targeted level of volatility.The expectation is that we will hold the better trending assets in an ideally weighted manner and maximize returns over time.The tradeoff is that we lose an element of diversification and we are exposed to systemic risks and sudden global economic changes that may have otherwise been damped by the asset classes that are excluded.We believe however for more aggressive accounts this risk will be more than offset by the prospective returns of this portfolio and its ability to operate well in a wide variety of economic regimes.