Category: Asset Allocation

Asset Allocation – USA – Dynamic CMA

The Dynamic CMA USA Portfolio asset allocation is designed to use the information gained from relative valuations to adjust asset allocation within the portfolio. The alignment moves toward increasing conservativeness as market and sector valuations approach overvalued positions and moves toward higher aspirational positions when market valuations move toward undervalued positions.

Asset Allocation 1st Quarter 2019

Investment Strategy Network has added another dimension to the asset allocation process. Traditionally, increasing stability or advancing opportunity (risk/return) has been accomplished through adjusting allocations amongst cash, bonds and stocks. Bonds are increased to improve stability, reduce risk and stocks are increased when opportunities are sought along with a willingness to accept higher fluctuations in value levels (volatility). Individual stock selection can also be adjusted along with the asset allocation to enhance stability or improve opportunity. By using the two as an integrated combination rather than individually, greater alternatives are available and more opportunities are generated.

Asset Allocation 4th Quarter

This report offers a discussion on a practical method of how asset allocation can be used to satisfy an investor’s desire for stability and opportunity within an investment portfolio. It is our objective to create a solid basis for understanding changes in allocations when considering objectives, risks and market characteristics.

Asset Allocation 3rd Quarter

The largest change in allocation goes to Financials with a 1.2 point increase. Other increases went to Consumer Staples 0.6 points; Utilities 0.6 points, Industrials 0.3 points and Telecom 0.2 points, Reductions occurred in Materials (0.3) points, and Consumer Discretionary (0.2) points.

Asset Allocation: U.S. View

In this brief we offer a discussion on a practical method of how asset allocation can be used to satisfy an investor’s desire for stability and opportunity within an investment portfolio. It is our objective to create a solid basis for understanding changes in allocations when considering objectives, risks and market characteristics.
The brief starts with a global view and then continues to refine focus until the allocation is centered exclusively on domestic sectors. At the end of the brief, there is a special section where consideration is given to portfolios that are concentrated in a single specific industry and how an investor can adjust a portfolio to reduce the impact of concentration.

Portfolio: U.S. Sector Only: LargeCap

This allocation results in a market weight, or near market weight (<0.5 percentage point difference) condition for: Energy, Financials, Health Care, Industrials, Information Technology, Materials and Utilities. Overweight positions for: Consumer Staples, and Telecommunication Services. Underweight positions for: Consumer Discretionary.

Portfolio: Global Index

Financials reduced by 0.7 percentage points, Consumer Staples increased by 0.5 points, Telecomm increased by 0.3 points and Utilities reduced by 0.2 points.

Asset Allocation: U.S. View

Asset allocation adjustments will move assets to undervalued areas and away from overvalued areas based on the degree of over/under valuation. The further the distance current valuations are above fair value, the lower the allocation will be for the asset area from market neutral. The further distance current valuations are below fair value, the higher the allocation will be for the asset area from market neutral.

Asset Allocation Discussion (American View)

In this brief we offer a discussion on a practical method of how asset allocation can be used to satisfy an investor’s desire for stability and opportunity within an investment portfolio. It is our objective to create a solid basis for understanding changes in allocations when considering objectives, risks and market characteristics. The major sections start with a global view and then continue to refine focus until the allocation is centered exclusively on domestic sectors. At the end of the brief, there is a special section where consideration is given to portfolios that are concentrated in a single specific industry and how an investor can adjust a portfolio to reduce the impact of concentration.

Update USA Asset Allocation

Large Cap stock allocations represent the majority of the stock allocation starting at 7.7% climbing to 68.9%, representing a 0.2 point increase from the last report. There is a similar allocation in both Mid and Small Cap areas that range from 0.6% at the Stable level for Mid Cap and 5.3% at the Opportunity level which is a 0.1% decrease. Small Cap experiences the same rate of growth starting at 0.3% climbing to 3.0% when it reaches Opportunity levels a reduction of 0.1 points from the last report.