The financial services industry has fallen in love with complexity. But complexity is often accompanied by poor results, high fees, and a lack of transparency.
We believe that by combining active and passive management styles and keeping costs low, we improve our clients' chances of reaching their long-term goals.
Portfolio Stress Testing
We build our Global Explorer portfolios using a "Core Plus Satellite" approach.
Our process is elegantly simple:
• Combine active and passive investment strategies.
• Use low-cost mutual funds and ETFs.
• Focus on minimizing transaction costs.
Our Investment Process
We start by constructing the portfolio core comprised of low-cost exchange-traded funds (ETFs) that provide broad diversification among global securities markets. The “core” of each portfolio provides very broad diversification among global securities markets.
We then selectively add “satellites,” to each portfolio if we believe these will improve the portfolio's long-term performance. Satellites may include actively managed funds, index funds or ETFs. We add satellites for one of three reasons: (1) to gain exposure to an asset class not represented in the core, (2) to overweight or underweight an asset class that is already represented in the core, or (3) to benefit from the skill of an active manager.
We have also developed our Global ETF portfolio series which consist of only Exchange Traded Funds (ETFs) in the core and satellites of each portfolio.
For tax conscious investors, our Global Explorer Tax Sensitive and Explorer ETF Tax Sensitive portfolio series address the specific needs of these clients.
The "Core" of Each Portfolio:
The core of each portfolio is the low-cost “engine” that drives its performance and represents between 50% and 100% of the total portfolio allocation.
The core provides very broad diversification among global securities markets.
Each core consists of low-cost investments, such as index funds or exchange-traded funds (ETFs), that track domestic or international stock or bond markets.
Implementing "Satellites" in Our Portfolios
Satellites may be added to a portfolio if we believe that they can improve the portfolio’s performance
These may consist of actively managed investments such as mutual funds, or passively managed, index-tracking investments such as index funds or ETFs.
There may be times when a portfolio has no satellites and consists entirely of its core. But we may add one or more satellites representing up to 50% of the portfolio
For example, we may add an actively managed mutual fund as a satellite because we believe in the skill of its manager, or we might add an ETF to gain exposure to an asset class not represented in the core.
This is not an offer of securities and is only a representation of the types of securities that we hold in our managed accounts and is provided for informational purposes only. Investing involves risk and past performance is no guarantee of future results. Barrington may utilize the services First Ascent Asset Management, LLC, a registered investment adviser with the U.S. Securities and Exchange Commission, for certain client portfolios.
Active Management & Rebalancing
The composition and allocation of each portfolio are reviewed at least monthly and the portfolios are rebalanced annually. To minimize transaction costs and the impact of taxes on taxable investors, trading in the portfolios will take place only when we have a high degree of conviction that it will contribute positively to the portfolio’s long-term performance.
In the case of individual client portfolios, the ups and downs of the securities markets will affect the relative values of the individual investments in the portfolio over time, so we rebalance each portfolio annually.