A New All-Terrain Approach to a Core Strategy for Financial Advisors

Among its main strategies, Wagner explained that the All-Weather static portfolio attempts to create a portfolio for all market regimes, rebalances yearly and aims for long-term capital-gain tax treatment. The portfolio utilizes S&P 500, five types of bonds and gold asset classes to help even out the ride.

The All-Weather dynamic portfolio attempts to create a portfolio for all market regimes but rebalances on a monthly basis to potentially capitalize on short-term moves. Moreover, it is available in leveraged, with a maximum of 2x or 200% leverage, for more aggressive investors and unleveraged versions.

Additionally, the Triadvantage is a tactical strategy that takes advantages of low historical correlation between equities and gold while also providing the ability to move into bonds when either of those assets are underperforming. Specifically, it may hold a 50% stake in gold or the S&P 500 if the momentum indicator remains positive, but the 50% positions may shift into cash and bonds if the momentum sours.

Looking at various investors’ risk tolerance and investment goals, the all-weather dynamic unleveraged and all-weather static strategies may fall under a moderate portfolio target. The all-weather dynamic-leveraged and triadvantage-unleveraged fall under a growth target. Lastly, the S&P 500 index and triadvantage-leveraged may be perceived as more aggressive options.

Moreover, Wagner pointed to a balanced approach through Flexible Plan’s Brighter Beta strategy, which includes ETFs that try to exploit market inefficiencies based on fundamental investing. Brighter Beta starts with a universe of strategic- or smart-beta ETFs and screens for qualified funds after volume and bid-ask spread filters, a proprietary rescreening process and a so-called evolution algorithm.

Financial advisors who are interested in learning more about risk-managed investment strategies can watch the webcast here on demand.