Model portfolios are being adopted by advisors at lightening speed, and that is turning itself into one of the fastest growing asset classes. This year model portfolios upped their holdings to $4.9 trillion, almost a 29% increase from the prior year. Companies like BlackRock have really leveraged model portfolios to fight inflation and changes to their portfolios yielded billions in inflows earlier this year. They aren’t just used to hedge against inflation they are being used to pick out ‘fallen angel’ corporate bonds which have a chance to ditch their junk bond status. Model portfolios allow for these tweaks which can more rapidly adjust to the macro changes in the economy.

FINSUM: Model portfolios give investors wider access to more quantitative methods which can outperform in the more volatile times like we are in now.