Asset Allocation
Selecting an appropriate asset mix is one of the most important decisions an endowment or foundation can make. Choosing between various classes of stocks, bonds, and other assets begins with understanding of the return, volatility, and correlation characteristics of each investment.
Applying resampled mean-variance optimization, NWCM develops a range of model portfolios that may be used to meet the client's investment objectives. These model portfolios are supported by additional analyses that provide historical support to the decision-making process.
In addition to developing a long-term strategic asset allocation, NWCM provides day-to-day tactical investment support. By allowing asset class exposures to vary within investment policy guidelines, an institutional portfolio can remain true to its investment objectives during changing market conditions.
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In addition to traditional stocks and bonds, investable asset classes may include categories such as private equity, absolute return or directional hedge funds, real estate, commodities, emerging market stock and bonds, inflation-linked bonds, etc.
Resampled mean-variance optimization addresses the uncertainty implicit in forward-looking estimates of return and risk by optimizing over many sets of asset class inputs.