Financial Advisor Magazine Interview with CEO Jon Robinson

Blueprint Investment Partners, an asset manager and pioneer in the creation of systematic, process-driven, and transparent investment strategies for financial advisors, was featured in a Financial Advisors Magazine Q&A. The interview between FA Magazine featured columnist Bill Hortz and Blueprint CEO and Co-Founder Jon Robinson addresses a variety of topics, including managing risk in a post-pandemic world, key questions advisors should ask of their asset managers, and what defines prudent investing today.

Below are two excerpts from the full interview.

A ‘Refreshing Alternative’ for Financial Advisors

Hortz: “Why do you characterize your firm as holding vastly different opinions, doing all the things that the industry would rather you didn’t do, and thereby offering a ‘refreshing alternative’?”

Robinson: “For starters, we are one of the few, if not the only systematic asset manager that is also 100% transparent with our rules. We believe that the rules themselves are not the ‘secret sauce.’ Our rules are time tested and statistically sound, but they are not the reason we will be successful. The ‘sizzle’ is in the disciplined execution of those rules, day in and day out. For some (not us), that might sound boring and uneventful. To paraphrase Warren Buffett, we believe that this is our ‘wide and long-lasting moat.’

Besides being systematic and transparent, we are also different in that we diversify across both assets and time. Asset diversification is standard operating procedure due to the mass adoption of Modern Portfolio Theory. Our risk budgeting process ensures that a portion of each asset class held in the portfolio remains passive, with infrequent rebalances. Time diversification is where we depart from standard Modern Portfolio Theory orthodoxy.

We apply two trend following strategies to each of the asset classes in the portfolio in order to gradually and systematically adjust asset allocation weightings, depending on the environment. This is how we diversify across time. Codifying this allows our decision making to be unemotional and disciplined with the objective of sidestepping major asset price declines. Additionally, the individual time frames are distinct to the extent they provide an additional layer of diversification through noncorrelation.”

Redefining Prudent Investing

Hortz: “What are examples of more prudent processes and actions needed in asset management that your research has led you to?”

Robinson: “One word: price. We utilize asset prices as the chief input in the decision-making model. The price of an asset is the only variable that directly affects the value of an investors account. There is no fundamental data point that can claim such a strong force. To precisely measure and manage risk, we focus almost exclusively on price to make decisions. Many times, fundamentals simply cannot react or update quickly enough to reflect a change in the environment. Price reflects these changes, in real-time.  This line of thinking is not reflected in the current zeitgeist.

We recognize that by being different, we are often held to a higher standard. We welcome these heightened expectations and attack them with our time-tested core beliefs: be transparent, be a good partner, be disciplined and listen to the data.”