Global Risk-Balanced Moderate ETF Strategy

This strategy employs a macro-driven, top-down style to construct a global tactical asset allocation portfolio with the greatest flexibility of all of our portfolios.

Benchmark: 50% MSCI ACWI Index; 45% Bloomberg US Aggregate Bond Index; 5% Bloomberg 1-3 month US T-Bill

Inception Date: 08/01/2010


The Global Risk-Balanced Moderate ETF Strategy seeks risk-adjusted long-term growth by employing a top-down style to construct a global tactical asset allocation portfolio with flexible guardrails. The investment team uses quantitative indicators and the firm’s macro-economic analysis to recommend global equity and fixed income asset classes and several sub-asset classes and sectors using only US listed ETFs.

Asset Allocation Guidelines

The strategy’s allocation is based on a long-term neutral policy of 50% equity, 45% fixed-income and 5% cash.

But it has the flexibility to go +/- 25%:

  • Equity: 25% to 75%

  • Fixed Income: 20% to 70%

  • Cash: 0% to 30%

Portfolio Construction

1. Top-down macro research

Investment committee performs ongoing analysis of factors such as corporate profits, liquidity and investor sentiment or valuation.

2. Risk assessment

Manage diversification based on correlation of assets within the portfolios, rather than the number of assets. Determine risk using capital market assumptions.

3. Strategic allocation guidelines

Guidelines provide an additional layer of risk management. Each portfolio has a neutral equity and fixed income allocation with guardrails to control the minimum and maximum allocation for each asset class.

4. Asset allocation

Construct global, multi-asset portfolios utilizing 5-30 ETFs that align with market views based on asset class, size, style, industry, geography and themes.


  • Utilize 5-30 ETFs to achieve desired exposures

  • Maximize contribution from top-down macro-economic views

  • Minimize portfolio risk through asset class portfolio risk measurement

  • Minimize stock-specific risk through usage of ETFs

  • Manage overall portfolio risk by “x-raying” the underlying holding of the ETFs