Portfolio overview
Our Tactical Allocation models are a series of six portfolios - Conservative, Moderately Conservative, Moderate, Moderately Aggressive, Aggressive, and All Equity – that provide overall asset allocation exposure for clients with varying risk tolerances and objectives.
The portfolios combine a strategic core of actively managed mutual funds with tactical holdings in passive ETFs.
Our models utilize Natixis affiliate products alongside offerings from third-party managers.
Our goal is to maximize return and outperform the benchmark while taking on reasonable risk relative to that benchmark.
Portfolios are managed with a 1–3% tracking error guideline to ensure they align with the risk profile of each model.
Portfolio construction
Portfolio construction is a four-step process:
Establish strategic allocations (annually)
Construct the tactical overlay (ongoing with a 3–6 month horizon)
Conduct manager research and selection to populate fund allocations (ongoing)
Monitor risk (ongoing)
We optimize our strategic allocations once annually and rebalance our holdings of traditional mutual funds at that time.
Thereafter the portfolios are adjusted on an ongoing basis via their ETF allocations, which represent approximately one-third of the overall portfolios.
Tactical views are developed by the portfolio management team in conjunction with the Natixis Investment Managers Solutions Investment Committee.
We execute 10–14 tactical trades per year within the ETF holdings.
Each model is managed against a dedicated benchmark that guides our asset allocation decisions.
Portfolio alpha is generated by asset allocation, tactical trading, and manager selection.
