Global Strategies With Continuum-Based Approach to Risk Management

Whereas many asset managers take a binary approach to risk management – they’re risk-on, or they’re risk-off – Blueprint Investment Partners considers it on a continuum. Our systematic investing process looks to reallocate to similar, stronger positions instead of heading to cash at the first sign of a downtrend.

An analogy is driving a car. When conditions are icy, you slow down to avoid a crash. But, it’d be foolish to keep driving at a crawl when the road thaws. Even a few snowflakes melting onto an otherwise clear road usually doesn’t warrant slamming on the brakes. With the proper mindset and equipment, you can adjust your speed to take advantage of smooth roads while managing for dangerous conditions.

A 'Handoff' Approach To Risk Management

When a downtrend emerges in any given asset class

We “handoff” that exposure to the next asset class experiencing uptrends. This allows us to reduce risk without going completely “risk off.”

When an uptrend re-emerges

We “handup” exposure by taking from asset classes expiring downtrends or, if several are in uptrends, by shifting exposures for historically lower-volatility classes back to their baseline weightings.

Illustration of the Blueprint risk handoff system

5 Primary Attributes Blueprint Portfolios

Global Asset Allocation

Portfolio diversification across eight major global asset classes in a single investment vehicle

Rules-Based Process Optimized for Behavioral Finance

Systematic investing process answers questions about what, when, and how much to buy and sell – repeatable rules that can help maintain discipline during prolonged market volatility by leaving no room for emotional decision-making amidst euphoria or fear

Dynamic Adjustments in Response to Market Changes

Asset allocation naturally adapts to market conditions – portfolio can look quite different depending on the environment (e.g., when there are uptrends/downtrends in an asset class, interest rates change, volatility arises, or inflation/deflation occurs)

Focus on Managing Downside Risk

Constructed to manage risk during bear markets and severe drawdowns (like 2022 and the Coronacrash of March 2020), but doesn’t need to go completely “risk off” amidst less significant pullbacks (especially those that affect only select asset classes, not the whole financial system)

Ongoing Tax-Loss Harvesting

Tax-friendly portfolio is possible by using a blend of timeframes – this time diversification allows losing positions to be sold quickly, but gains can be held as long as uptrends persist

Monthly Asset Allocation Update

Summary of current positioning

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If you’d like to learn more about our risk-managed, global asset allocation strategies