S&P Investment Advisory Services (SPIAS) www.spiasllc.com | [email protected] | 877-393-4360
Model Allocation Portfolios (MAPs)MAPs are fund-based model portfolios tailored to various risk profiles. They cover a broad spectrum of investment strategies, so advisors can use them as comprehensive, ready-to-implement investment solutions.
For financial advisor use only. Not for distribution to the public.
The numbers above represent the equity/fixed income allocation (i.e. 20/80) and investment time horizon (i.e. 3-5 years).
R E T U R N
R I S K
Income Generation
20/803-5 years
Purchasing Power
Preservation30/70
3-5 years
Conservative40/60
5-7 years
Moderate Conservative
50/507-10 years
Moderate60/40
10-15 years
Moderate Growth70/30
15-20 years
Growth80/20
20-25 years
Enhanced Growth90/10
25 years
Current Income Capital Appreciation
Current Income and Capital Appreciation MAPsThere are two types of MAPs: Current Income and Capital Appreciation, which encompass a total of eight risk profiles.
Current Income Capital AppreciationInvestment Objective
Capital preservation and income Capital growth
Investment Strategy
Diversification with larger allocations to income generating investments
A well diversified, total portfolio solution
Asset classes
• Capital Growth• Real Return• Income-Oriented
• Equities• Specialty Equity• Fixed Income
Risk profiles
• Income Generation• Purchasing Power Preservation
• Conservative• Moderate Conservative• Moderate
• Moderate Growth• Growth• Enhanced Growth
Use cases
For financial advisors’ clients that have already accumulated capital and are looking to maintain value and supplement income
For financial advisors’ clients that have longer time horizons and are looking for capital appreciation concurrent with their risk tolerance
MAPs Availability
Fixed Income
International Equity
Domestic Equity
Specialty Equity
Cash
Investment MethodologyThe foundation of SPIAS’ MAP investment methodology is:
A dynamic asset allocation approachDynamic asset allocation combines a strategic, long-term approach with some tactical tilts. This blended approach seeks to adjust positioning in light of major macroeconomic events and shifting market cycles, while maintaining a long-term view.
An open architecture, unbiased fund selection strategyInstead of using proprietary funds, SPIAS researches the universe of investable funds for inclusion in the MAPs. The best fit for the model is chosen, regardless of the fund family. Researching and using different fund families can reduce concentration risk.
Investment Process
Asset AllocationSPIAS blends a quantitative and qualitative approach to determine baseline asset allocation for each MAP.
The SPIAS Portfolio Strategy Committee (PSC) is a group of investment professionals with over 20 years of experience. They are the qualitative function of the asset allocation process.
The PSC meets weekly to review and discuss the global market outlook and macroeconomic environment. They continually monitor the MAPs, review the asset allocation strategy each quarter, and make changes when deemed appropriate.
Fund SelectionTo complete the construction of a MAP, SPIAS seeks to invest in funds that best align with the asset allocation strategy and investment objective of each risk profile.
To identify funds for inclusion, SPIAS:
• Selects funds that best represent respective styles
• Screens funds for consistency of performance, structural characteristics, cost efficiency, and liquidity
• Performs research on funds and their characteristics
Once investment selections have been made for each asset class, the team reviews them on a quarterly basis to verify they maintain consistent performance for the targeted level of risk and are still the most appropriate and effective option.
PSC studies 20 asset classes and projects 12-month expected
return and volatility forecasts
Uses Black Litterman Model to merge qualitative PSC views with historical measures of return and quantitative measures of volatility
Perform mean variance optimization to construct MAP
portfolios
PSC does a final review of the model output
Qualitative Qualitative Quantitative
Standard & Poor’s Investment Advisory Services LLC (“SPIAS”), is a wholly owned subsidiary of S&P Global Inc., and a part of S&P Global Market Intelligence. SPIAS provides non-discretionary advisory services to institutional clients and does not provide advice to underlying clients of the firms to which it provides advisory services. SPIAS offers advisory services in the United States and does not act as a “fiduciary” or as an “investment manager”, as defined under Employee Retirement Income Security Act (ERISA), to any investor.
MAPs are not collective investment funds. Securities in the models may decrease in value and a MAP investor may lose money. Fund availability and target allocations are subject to change, and SPIAS reserves the right to make changes to the fund selection process. Past performance of a model is not indicative of future returns. An investment based upon the model should only be made after consulting with a financial advisor and with an understanding of the risks associated with any investment in securities, including but not limited to, market risk, currency risk, interest rate and foreign investment risk. MAPs allocate to various asset classes such as small and mid-capitalization securities that entail greater risk than investing in large capitalization securities. All investments carry some degree of risk and investors may not get back all they have invested.
MAPs may include funds to which S&P licenses intellectual property or has another financial interest, including ETFs based on a proprietary S&P index such as the S&P 500. SPIAS has a potential conflict of interest in including these funds in models: if S&P gets fees tied to a fund’s assets, it will generally earn compensation in addition to the fees paid to SPIAS. SPIAS may consider research and other information from affiliates in making its investment recommendations.
SPIAS is not a tax advisor. SPIAS does not take into account any information about any investor or any investor’s assets when creating, providing or maintaining any model. SPIAS does not have any discretionary authority or control with respect to purchasing or selling securities or making other investments. Individual investors should ultimately rely on their own judgment and/or the judgment of a financial advisor in making their investment decisions.
For a more detailed description of investment risks and indices comprising the benchmark for each risk profile since inception of the MAP please see https://www.spcapitaliq.com/disclaimers/spias-investment-advisory-services
Copyright © 2017 by S&P Global Market Intelligence. Redistribution, reproduction and/or photocopying in whole or in part is prohibited without written permission. STANDARD & POOR’S, S&P, S&P 500, CAPITAL IQ, and S&P CAPITAL IQ are registered trademarks of S&P Global Market Intelligence Inc. or its affiliates.
For financial advisor use only. Not for distribution to the public. 170705
MAPs Portfolio Managers
Charlie Bassignani Chief Investment Officer
Charlie leads the Model Research & Development team and is primarily responsible for portfolio construction and risk analysis. He is a voting member of the Portfolio Strategy Committee and a member of the Fund Review Committee. Charlie joined S&P Global in 2002.
Michael Carapucci Deputy Chief Investment Officer and Portfolio Manager, Multi-Asset
Michael oversees the asset allocations and fund selections for SPIAS’ multi-asset class strategies. He is a voting member of the Portfolio Strategy Committee and serves as the chairperson of the Fund Review Committee. Michael joined S&P Global in 1997.
Naveen Kallu Portfolio Manager, Asset Allocation
Naveen is responsible for providing model-driven asset allocation recommendations for SPIAS’ MAPs. He is a voting member of the Portfolio Strategy Committee and a member of the Fund Review Committee. Naveen joined S&P Global in 2009.
