Asset Management Services

From Asset Allocation to Strategy Diversification

WealthPLAN Partners has taken portfolio allocation to a new level. We recognized that the Modern Portfolio Theory, introduced by Harry Markowitz in 1952, wasn’t so modern any more.

Our investment strategy, based on Strategy Diversification, takes a more comprehensive look at overall portfolio volatility and the correlation of returns, to put forth a risk narrative in addition to return expectations. Diversifying among Strategy Theme Asset Classes is designed to better address each investor’s needs, while seeking to lower their risk and volatility.

  • Correlations between Asset Classes show how much they tend to move in the same direction and to what degree.
  • Look at how the traditional Asset Classes (Growth – Value – Small Cap – International – Emerging Markets) all tend to be highly correlated to the S&P 500.
  • The straightforward implication is that the standard equity Asset Classes don’t offer much true diversification as they tend to move in a very similar direction.

The WealthPLAN Partners Difference:

  • By paying attention to correlations and return streams, we created new asset classifications based on Strategy Themes.
  • We believe these offer truer diversification benefits and better opportunities to achieve similar market-like returns with reduced levels of volatility.
  • We believe using this enhanced risk-based approach allows us to design portfolios that strive to meet return and volatility characteristics that are a better fit for our clients’ asset management needs.

Contact our Wealth Advisors to learn more about Strategy Diversification.

No strategy assures success or guarantees against loss.

There is no guarantee that a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not eliminate market risk.

Past performance is no guarantee of future results.

Modern Portfolio Theory (MPT) is an asset allocation theory on how risk-averse investors can construct portfolios to optimize or maximize expected return based on a given level of market risk, emphasizing that risk is an inherent part of higher reward. There is no guarantee that it will enhance overall returns. Asset allocation does not ensure a profit or protect against a loss.