This summer, Balentine became GIPS® compliant. While GIPS is common practice in the institutional world, only 1% of wealth management firms can make this claim.
Find out why Balentine typically choose to be passive in efficient asset classes, and how we decide whether active management may be more appropriate.
Portfolio rebalancing is the process of bringing a portfolio that has deviated from a target allocation back in line. The prevailing notion for much of the investment industry has been to set and then forget an investment portfolio and only rebalance on a regularly scheduled basis, either monthly quarterly or in some cases yearly. Despite the fact that this has long been the industry standard, in the current low-return environment, this “set it and forget it,” autopilot strategy simply is not good enough.
Progress in the European debt crisis and better US economic data over the last three months have led to significantly less market volatility. As risks to the near-term outlook have abated, momentum in global equity markets has accelerated. Based on the long-term attribution of our returns, such an environment typically provides a compelling backdrop for us to harness the power of our quantitative models, because during such “normal” market environments, underlying asset class performance trends persist for longer.
Balentine employs an “Art and Science” approach to investment management. Within this approach, Science, a term that describes our highly objective investment decisions based on our scientific models, determines our strategic neutral position given today’s starting point. Our annual Capital Markets Forecasts are used to determine that strategic neutral position and the investment course we chart.
2011 was filled with many ups and downs – with issues ranging from natural disasters to politically-created ones affecting markets. In this three part series, we will look back at some of the biggest factors that affected the economy and examine their potential impact going forward. In Part One of this series, David Damiani, Director of Risk Management, discusses Balentine’s risk-first approach to investing and the benefits of approaching investments in this way.
In 1970, Warren Buffett opened a family safety deposit box to discover a letter from his grandfather and $1,000 cash. The letter, written to Buffett’s uncle on his 10th wedding anniversary, extolled the virtues of ready cash, explaining, “Over a period of a good many years I have known a great many people who at some time or another have suffered in various ways simply because they did not have ready cash.”
In our Market Notebook, we often share information when we make policy changes, explaining the What (the allocation change), the When and the Why (the reasons behind the rebalance), but we have never explained the How: the behind the scenes mechanics that go into an allocation change. Though Balentine is not a Broker Dealer, each time a policy change is enacted, portfolio implementation considerations play a central role. Implementation is one of the key components of investment management and though often overlooked or misunderstood, implementation has important implications for our clients’ portfolios.