Our technology is a quantitative investment tool that analyzes a broad universe of mutual funds and ETFs. It seeks to determine optimal portfolio allocation and is designed to generate positive returns over multiple market cycles. Our disciplined process for portfolio construction is explained below.
1 Clients goals are established.
The advisor and client establish the goals for the portfolio and determine a plan of action.
2 Risk profile is assigned and investment strategy is selected.
The advisor and client select a portfolio strategy based on client goals and risk tolerance.
3 Optimal securities are chosen from approved list.
Based upon steps 1 and 2, each client’s portfolio is assigned a dedicated universe of investments for the technology to analyze.
4 Mutual funds and ETFs are monitored daily.
At the end of every day our technology measures the prices of the investments contained inside of the portfolio.
5 Mutual Funds and ETFs are given a composite score.
Each investment inside of the model is assigned a composite score over the analysis period to determine how each investment is behaving in the current market conditions.
6 The most productive mutual funds & ETFs are selected.
The technology selects the combination of investments it deems to be the most productive based on the current market conditions.
Strategic Financial Concepts’ technology utilizes sound mathematics and empowers each piece of the portfolio to identify and move towards productive asset classes or align volatility.
Traditional methods often penalize investors with predetermined allocations and prohibit investors from seeking safety in times of market stress.
Traditional Strategic Asset Allocation Approach:
Portfolio is rebalanced by taking from winners and giving to losers. Portfolios begin with target weightings and are often rebalanced annually to the original targets regardless of market conditions.
Tactical Asset Allocation Process:
Each piece of the portfolio competes with other asset classes or cash to find optimal productivity based on the most current market environment. Unproductive sectors are replaced with those showing the most strength.
Target Volatility Allocation Process:
Portfolios are periodically rebalanced to maintain a suitable risk tolerance as market conditions change. Asset class weightings are consistently adjusted to reflect current market volatility.