We construct our core portfolios using primarily a mixture of mutual funds and exchange traded funds. We use both passive and active strategies, depending on how strong our convictions are with respect to certain sectors and the ability of active managers to outperform their applicable index net of investment fees on a consistent basis.
At the outset, we perform a significant amount of diligence on the managers or index funds we select for our clients' portfolios. We then monitor the managers, their portfolios, and their performance on a regular basis, although performance is not the sole factor in our decision to keep or replace a fund.
We draft an investment policy for each client that addresses their unique goals and objectives. We then pull this information into a spreadsheet that incorporates all of their investment accounts/assets and compares their existing allocation to the model portfolio we have created for them. We make changes where necessary to keep their entire investment portfolio in balance.