Simple Solutions believes that effective asset allocation is the key to delivering good performance for our client’s investments.
Click here to read about the foundations for building a diverse portfolio.
Asset allocation is the principle that different asset classes deliver returns that are not perfectly correlated. This helps to reduce risk.
The primary goal of a strategic asset allocation is to create an asset mix that will provide the optimal balance between expected risk and return for a long-term investment horizon.
Each client’s risk profile is determined by answering a series of questions relating to investment scenarios and risk and reward. This provides us with a score between 1 and 10, with 1 being very cautious and 10 being very adventurous and speculative.
We then use research provided by a leading actuarial company called Towers Watson & Co to provide the asset allocation that should apply to each risk profile based on global economic conditions at that time.
This is reviewed and amended periodically.
We also have a robust selection process that is designed to ensure that the funds we select for our client’s portfolios have been thoroughly researched before selection.
We have an Investment Committee who meet periodically to review the performance of the existing funds in our portfolios against the performance of their peers.
We use Analytics, a quality software research package, to provide us with comprehensive data and analysis that allows us to filter funds down to the best performing funds in each asset class and geographical sector.
The selected funds are then used in our portfolios and where appropriate we also rebalance our existing client’s portfolios to match the new model.
If you would like to discuss your investment options please contact us.