Investing to the Pulse of Change
Global Tactical Strategies
FIS Group’s Tactical Allocation Strategies and Tactical Overlay Strategies embrace dynamic change and seek to align investment capital toward emerging opportunity and away from oversized risks.
As an unfettered expression of our global macro view, our tactical allocation strategies allow us to make strategic adjustments to our portfolios or act as standalone strategies to complement an investor’s long-term view. The strategies utilize a hybrid approach combining quantitative tools with a qualitative overlay to create portfolios of highly liquid ETFs or equities
Tactical Allocation Strategies
Available with either a U.S. or Global focus, our tactical allocation strategies seek exposure to favored sectors, industries, countries, and style factors identified through quantitative models designed to forecast relative performance and our overall global macro view. A key element of this strategy is our proprietary Market Risk Indicators that signal defensive positioning based on a measure of aggregate market risk. This system characterizes market environments as either “risk on” or “risk off” and supplies short-term signals of the market’s current pricing of risk through various market sentiment indicators. These indicators of long-term and short-term risk allow us to identify advantageous portfolio positioning.
The combination of forecasts, qualitative overlay, and risk management are designed to provide outperformance vs. relevant benchmarks over time.
Tactical Overlay Strategies
Tactical Overlay Strategies implement FIS Group’s global macro outlook in concert with an existing, multi-manager portfolio. Through overlay management, we amplify or reduce exposures to market beta risks based on our proprietary analysis of macro factors and risk indicators.
As an integral part of our Tactical Overlay Strategies, FIS Group monitors sub-managers’ positions to evaluate the aggregate exposure of the overall portfolio to major sectors, countries, and regions; and to address overexposures and underexposures swiftly and efficiently through the use of the tactical portfolio. The tactical portfolio is also designed to enhance the overall portfolio’s return by investing in country, regional, and sector level ETFs or fully collateralized futures.
With overlay management we seek to deliver attractive risk-adjusted returns over full market cycles through strategic portfolio positioning and active risk-management. We also seek to greatly reduce implementation costs from portfolio rebalancing and from manager changes.
Market Insight Alerts
Long duration equity strategies (growth, technology, certain private equity LBO strategies) appear vulnerable….
It is difficult to build a case that equity markets won’t contract in a slow-down. Since 1950, whenever CAPE valuations were above 20 and industrial production declined in the previous 12 months, the 12-month return of the stock market was -10.4%, with only 34% of periods having positive returns.read more