Investment Philosophy

We are committed to providing our clients with strategies that allow them to express their economic point of view, consistent with their risk tolerance and time horizon. Too often a client’s individual needs are ignored and investment goals are unrealized. Toroso’s asset allocation approach offers an alternative to Modern Portfolio Theory style portfolios that have failed to meet expectations over many decades due, in large part, to the increasing correlation of world markets and the disregard for clients’ actual investment time horizons. These portfolios have moved in lock step with volatile equity markets and have failed to meet investors’ investment goals. Toroso recognizes the needs of its clients: maintaining a more balanced risk profile and generating solid returns.

ETP Selection

Toroso believes the importance of ETP selection is on par with the importance of asset allocation.  With the proliferation of ETPs and a lack of industry standards that apply to them, there is a need to critically evaluate ETPs so that solid returns are obtainable.  The Toroso method examines the interconnections between ETPs and the relative value of each ETP, based on its fundamentals, rather than focusing solely on past behavior.  Our experts understand precisely the underlying securities that comprise ETPs and strive to create portfolios that are optimized based on those fundamentals.  Additionally, we focus on minimizing product risks, assessing whether structures are appropriate and achieving liquidity so that our clients are assured they are capturing their intended portfolio exposure.

Multi-Asset Class Portfolios

Our investment strategy models are based on an easy to understand multi-asset class principle that targets five different economic scenarios – neutral, prosperity, recession, inflation and deflation.  These five target portfolios encompass a mix of just four clearly defined uncorrelated asset classes that are weighted geometrically based on economic views.  This strategy ensures that not one adverse economic environment will deplete a client’s portfolio and strives to deliver solid returns with a more balanced risk profile.

Target Income Portfolios

The Target Income Series uses ETPs to create fixed income portfolios intended to behave more like traditional bonds.  The goal of the portfolio is to target a specific yield while returning principal at a target date.  While it is impossible to guarantee the receipt of income or return of principal, the proliferation of ETPs has created the opportunity to build synthetic bonds that simulate traditional bond characteristics, but reduce risk through greater diversification.


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