Hoffstein suggests advisors can utilize these ETF managed portfolios tactically and manage risk for both equity and fixed-income investments. Specifically, for the firm’s global sectors strategy, Hoffstein argues that investors and advisors should think beyond domestic only or international only investment strategies. Instead, the ETF managed portfolios offer a blend of the two areas in the same basket. Most advisors are currently worried about the international markets and more complacent about U.S. equities. However, U.S. stocks are either fairly priced or beginning to look expensive, whereas there are many cheaper opportunities overseas.
“There are greater opportunities in global markets in the next five to ten years, but many risks as well,” Hoffstein said. “We believe a risk managed approach can provide meaningful exposure without leaving investors unprotected.”
ETF managed portfolios are investment strategies that hold more than 50% of assets invested in ETFs and represented one of the fastest growing segments in the separate accounts space. Specifically, ETF managed portfolios offer three major investment themes: tactical, strategic and hybrid mix. The tactical offerings provide short-term plays to capitalize on investment opportunities that are forming, whereas the strategic play provides long-term allocation across sectors and asset classes. Additionally, the hybrid mix includes a combination of tactical and strategic elements.
