»Strategic Alternative Portfolio - Lindner Capital · Source: Dimensional Fund Advisor Master...
Transcript of »Strategic Alternative Portfolio - Lindner Capital · Source: Dimensional Fund Advisor Master...
»Strategic Alternative PortfolioClient Presentation
Presented to:Presented by:Date:
Lindner Capital Advisors. A Registered Investment Advisor. 600 Village Trace, Building 23, Marietta, GA 30067
At Lindner Capital, we construct portfolios based on sound academic and evidenced based principles.
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Creating a Successful Investment Experience
Where Most People Focus What Really Matters
Focus on What You Can Control
3Diversification neither ensures a profit nor guarantees against loss in a declining market.
No one can reliably and consistently forecast the market’s direction or predict which stock or investment manager will do best at any given time.
We can help you create a plan and focus on the actions that really matter.
Creating an investment plan to fit
your needs and risk tolerance
Structuring a portfolio around dimensions of returns
Diversifying broadly
Reducing expenses, turnover and taxes
Staying Disciplined
What Really Matters
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Have You Been a Victim to Your Emotions?
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Resist the Urge Acting on your emotions may negatively impact your Investment experience.
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Strategic Alternative Portfolio Overview
Moderate growth strategy that seeks long-term growth of capital with an emphasis on minimizing downside volatility
Investments are institutional mutual funds: 53% - LCA Traditional Equity strategy 22% - LCA Traditional Bond (fixed income & money mkt) strategy 25% - Alternatives to minimize downside volatility
35%
18%
25%
18%
4%
Allocation
These are the target allocation weights and actual accounts may vary.
35% Domestic Equity18% International Equity25% Managed Futures18% Fixed Income
4% Money Market
Equity Strategy Overview
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LCA's Approach
Philosophy Gains insights about markets and returns from academic research
Portfolio Construction
Structures portfolios along the dimensions of expected returns
Process Adds value by integrating research, portfolio management, and trading
Our Core Beliefs Building blocks to investment success
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Advisor Use Only
Core Principle One
• Markets Are Efficient
Core Principle Two
• Diversification Is Key
Core Principle Three
• Structure Explains Performance
Core Principle Four
• Discipline and Long Term Investing
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All Available
Information
Markets are EfficientWhat Affects a Stock’s Current Price?
Core Principle One
A company’s equity, its prospects for future
earnings, and perceived risk
Price
Given all information, a stock’s current price offers the best approximation of actual value.
Source: Dimensional Fund Advisor Master Presentation dated September 2016 – slide 170
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Staying disciplined through rising and falling markets can pose a challenge, but it is crucial for long-term success.
DiversificationTake the Guesswork out of Investing
Core Principle Two
Annual Returns
You never know which markets will outperform from year to year.
Some investors may be tempted to switch asset classes. Don’t let Fear and Greed get the best of you.
Source: Morningstar
* LCA Traditional Retirement 65/35 returns are net of all fees.
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Information provided by Dimensional Fund Advisors LP.Indices are not available for direct investment. Past performance is not a guarantee of future results.1. Profitability is a measure of current profitability, based on information from individual companies’ income statements. In US dollars. Based on rolling annualized returns using monthly data. Rolling multiyear periods overlap and are not independent. This statistical dependence must be considered when assessing the reliability of long-horizon return differences. “One-Month Treasury Bills” is the IA SBBI US 30 Day TBill TR USD, provided by Ibbotson Associates via Morningstar Direct. Dimensional Index data compiled by Dimensional. Fama/French data provided by Fama/French. The S&P data is provided by Standard & Poor's Index Services Group. Eugene Fama and Ken French are members of the Board of Directors for and provide consulting services to Dimensional Fund Advisors LP. Index descriptions available upon request. Source: Dimensional Fund Advisor Master Presentation dated 2017– slide 109
Core Principle ThreeStructure Explains PerformanceUS Markets - Historical Performance of Premiums over Rolling Periods
$0
$1
$10
$100
$1,000
$10,000
$100,000
1926 1936 1946 1956 1966 1976 1986 1996 2006 2016
4. Let Markets Work for You-USE INSTEAD??
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The financial markets have rewarded long-term investors. People expect a positive return on the capital they supply, and historically, the equity and bond markets have provided growth of wealth that has more than offset inflation.Past performance is no guarantee of future results. In US dollars. Indices are not available for direct investment. Their performance does not reflect the expenses associated with the management of an actual portfolio. US Small Cap Index is the CRSP 6-10 Index; US Large Cap Index is the S&P 500 Index; Long-Term Government Bonds Index is 20-Year US Government Bonds; Treasury Bills are One-Month US Treasury bills; US Inflation is the Consumer Price Index. CRSP data is provided by the Center for Research in Security Prices, University of Chicago. The S&P data is provided by Standard & Poor's Index Services Group. Bonds, T-bills, and inflation data provided by Morningstar. The information shown here is derived from such indices, bonds, and T-bills.
Growth of a Dollar, 1926–2016(Compounded monthly)
Core Principle FourDiscipline and Long Term Investing
Source: Dimensional Fund Advisor Master Presentation dated 2016, slide 6
$20,544 US Small Cap Index
$6,031 US Large Cap Index
$134 Long-TermGovt. Bonds Index
$13 Inflation (CPI)
Bond Strategy Overview
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LCA's Approach
Philosophy Gains insights about markets and returns from academic research
Portfolio Construction
Structures portfolios with shortermaturities and higher credit quality.
Process Adds value by integrating research, portfolio management, and trading
Alternative Strategy Overview
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Managed futures offer investors an interesting alternative in today’s environment.
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The statements above may be viewed as “forward-looking” statements or opinions based on current expectations, estimates, projections, and assumptions that by their nature, cannot take into account unknown risks and future uncertainties, which are difficult, if not impossible to predict. Such statements are not guarantees of any future performance or outcome. There is no guarantee any investment product will achieve its objectives, generate profits or avoid losses. Past performance is not indicative of future results.
The opportunity to enhance overall portfolio returns
The potential to lower overall portfolio risk
(downside volatility)
The opportunity to broadly diversify
investments
Potential for profit in any economic environment
Having managed futures within well-balanced portfolios offers several benefits:
Why Managed Futures
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Alternatives Performance in Down Markets
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LCA Portfolio Management
Strategic Alternative
LCA
Value and Small Cap Tilt
Alternatives limit downside volatility
LCA has long term track record (1996) managing portfolios. The Strategic Alternative’s inception date is 2/1/10.
Fixed Income - Short Duration and High Credit Quality
• Global diversification with over 12,000 securities, 40 countries and 15 asset classes.
• LCA’s Core Principles are based on the work of Nobel Prize winning academics.
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Your Risk Score = Your Portfolio
Your Investment Advisory Team
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CLIENT
Financial Advisor
Lindner Capital Advisors, Inc.SEC Registered Investment Advisor (RIA)
Designs & Manages Portfolio
Custodian Fidelity, Schwab, TD Ameritrade, etc.
Holds Assets
“The important thing about an investment philosophy is thatyou have one you can stick with.” David Booth
DisclosuresLindner Capital Advisors, Inc. (LCA) is an SEC registered investment advisor. The information contained in this document is confidential and is intended only forthe use of the person to whom it is given and is not to be reproduced or redistributed without LCA’s consent. It is not a solicitation to invest in any specificinvestment product, nor is it intended to provide individualized investment advice. This presentation does not constitute an offer to sell or the solicitation of anoffer to buy any securities, nor will any sale of a security occur in any jurisdiction where such an offer, solicitation or sale would be unlawful.
Asset allocation and diversification strategies do not assure a profit or protect against a loss. Different types of investments involve varying degrees of risk, andthere can be no assurance that any specific investment strategy will be profitable. Each asset class has inherent risks associated with that asset class.Understanding these risks is critical to making reasonable risk/return comparisons and sound investment decisions. Each of LCA's strategies may make small-capand micro-cap investments, which are subject to greater volatility than those in other asset categories. Each of LCA's strategies may invest in fixed-incomeinvestments, which are subject to various risks, including changes in interest rates, credit quality, market valuations, liquidity, prepayments, corporate events, taxramifications, and other factors. Each of LCA's strategies may make international investments, which are subject to additional risks, such as currency fluctuation,confiscatory policy, political instability, or potential illiquidity. Investing in emerging markets may accentuate these risks.
Inclusion of market index information is for informational purposes only and does not imply that a strategy will achieve similar returns. Index performance does not reflect the deduction of transaction costs, management fees, or other costs which would reduce returns. An investor cannot invest directly in an index. The composition of an index does not reflect the manner in which a strategy is constructed in relation to expected or achieved returns, investment guidelines, restrictions, sectors, correlations, concentrations, volatility or tracking error targets, all of which may change over time.
Past performance is no guarantee of future performance, and LCA’s strategies, like most investment strategies, involve the risk of loss. Since no one manager issuitable for all types of investors, it is important to review investment objectives, risk tolerance, liquidity needs, tax consequences and any other considerationswith a financial professional before choosing an investment style or manager. The information contained in this document has been compiled from sourcesdeemed reliable and it is accurate to the best of our knowledge and belief. However, LCA cannot guarantee its accuracy, completeness, and validity and cannot beheld liable for any errors or omissions.
Lindner Capital Advisors, Inc.
600 Village Trace, Building 23, Suite 300, Marietta, GA 30067770-977-7779 | www.LindnerCapital.com
Strategic Alternative-PRES-A-072717