Blumenthal on the New Modern Portfolio Theory

Financial AdvisorAdvisors are increasingly employing tactically managed investment strategies, and Steve Blumenthal thinks that’s good. Advisors can now access some of the same alternative investment strategies once reserved for institutions.  In the The New Modern Portfolio Theory in Financial Advisor magazine, CMG Capital Management Group CEO Stephen Blumenthal says:

Nearly half of all advisors are using some sort of tactical investment strategy, according to new research from Cerulli Associates. This important research quantifies what we have been witnessing—advisors are actively seeking alternatives to the 60/40 buy-and-hold investment approach of the past.

Why? The 60/40, stock/bond asset allocation model favored by most investment houses and embraced by advisors for a generation is outmoded and not likely to help investors achieve their objectives.

A balanced portfolio today is comprised of 33 percent equity (hedged from time to time), 33% fixed income (tactically managed) and 34% tactical-trading-alternatives. Read the full story.

Stephen Blumenthal is CEO of CMG Capital Management Group Inc. The firm offers managed accounts, mutual funds and variable annuities that are constructed to benefit from current economic conditions, and aim to provide steadier performance in all market cycles.