Page 10 - Strategy Flipbook v.2_Classical

1 Bull Market 2 Transitional Market The Thermostat makes adjustments
Asset Allocation Asset Allocation according to how the portfolio’s holdings are
behaving in reaction to market shifts.
Cash Alternatives Cash
For instance, if one of the Global Equities
Alternatives holdings begins to exhibit greater volatility
in the new bear market environment, it
EQUITY: might trigger a Sell Signal. The Thermostat
SELL would then sell this security and look to the
highest-ranked security in its universe that is
Global Global triggering a Buy Signal rating. Only
Equities Equities securities with low or decreasing volatility
will exhibit a Buy Signal. Security selection is
3 Asset Allocation Possible Buys thus based on a two-tiered rating (Buy, Sell,
(ranked highest to lowest) or Hold) and ranking (against other
Alternatives Cash securities) process.
EUM DOG EWZ
BUY As we shift into a bear market, Alternatives
increasingly top the list of possible buys.
This will eventually result in a falling
percentage of global equities in the
portfolio, while alternatives and cash
increase.

Global
Equities