Displaying items by tag: models

(New York)

Market volatility has been rising substantially and advisors may be interested in looking for holistic ways to diversify risk. Take a look at WisdomTree’s lineup of models, which are quite comprehensive. Using a factor-based approach, WisdomTree has a number of models to help investors hedge risk. This kind of approach can be quite useful right now as the market has been so unpredictable. According to the CIO of WisdomTree “We see an almost total factor performance reversal. In Q1 (when interest rates were rising), the market was led by value, dividends, and quality, with growth and momentum trailing far behind … But since then (as interest rates have fallen), it has been exactly the opposite—growth, momentum, and quality have led the way, while value and dividends dramatically underperformed”.

FINSUM: Models are an increasingly popular way for advisors to achieve a lot of investing goals, and they may be most useful because they can help save time by giving a single point-of-access to a comprehensive strategy.

(New York)

Any advisor will have noticed the big industry push towards model portfolios, and in particular, model ETF portfolios. To many, this might be a “what gives?” moment. The reason why is actually a simple one for both advisors and asset managers. For asset managers, models can be a very nice singular location to gather up assets. For advisors, it is all about saving time and getting the best of a wide array of ETFs. Model portfolio can allow advisors to get access to a range of best-of-breed products without the need to proactively take the time to diversify client Dollars into those funds.

FINSUM: Model portfolios are going to keep growing. They are generally a win-win for both advisors and managers.

(New York)

Advisors likely know Global X as a leader in thematic investing—heck they practically invented the space! Well the know-how and expertise you know and love from their ETFs is available as part of a suite of model portfolios at Orion. In partnership with Orion Portfolio Solutions, Global has launched both an Equity Thematic Disruptors ETF Model Portfolio and five Core Series Models tailored to specific risk appetites. In Global X’s own words, the Equity Thematic Disruptors ETF Model Portfolio “Targets structural and long-term trends that transcend traditional sector investing and provides investors with access to potential growth opportunities”.

FINSUM: Exciting to see Global X bringing its edge to the model world. The Disruptors model seems like a one-stop shop to access cross-sector innovation.

(New York)

The model portfolio world has grown highly confusing over the last few years. The explosion in popularity of models has led to thousands on the market, making it very hard to sort one from another. Luckily, Morningstar has launched a new product to help do just that. Morningstar’s new ratings are on a one to five scale (like their mutual fund ratings) and they have increased coverage recently from 76 models to 139. They are also now covering not just SMA models, but theoretical ones. Morningstar gave only 2 out of 1,500 models its top “gold” rating, and one of the pair was Vanguard’s CORE portfolio. According to Morningstar, CORE has “an extremely appealing price tag along with top notch, highly diversified underlying index funds”.

FINSUM: This rating system will be a great resource for advisors, especially as coverage continues to increase. These scores will be useful not just for investment selection, but also for highlighting their utility and legitimacy to clients.

(New York)

Model portfolios are getting ever more popular for advisors. Not only do they help outsource some portfolio management, but there is such a wide variety of them that they can be tailored to many different plans. In some cases, there are almost too many! One area where they make a lot of sense is in tax minimization strategies. Biden and the Democrats look like to hike taxes considerably, and that fact coupled with ultra-low yields and highly variant financial situations in muni bonds, means there is a lot to gain from models in this area.

FINSUM: COVID affected municipalities in very different ways, and spreads to Treasuries are historically low, so there is a of risk. Nuveen is seen as a leader in the munis space, so a good place to start the search.