As of March 20, 2019
Model Name Change: CORE NTF is now COST NTF
While there are no material changes to the portfolio, with the exception of the fund swap below, we believe this name change better reflects the purpose and reason behind this portfolio. Still very much a “CORE” portfolio, much of the focus of this portfolio is on reducing cost and making it as accessible as possible. All funds are based on NTF (or no transaction fees) and there is a conscious effort to limit the expense ratios in the investments utilized.
NEW Model Announcement: Kick Start
We have added a solution exclusively for smaller accounts. The "Kick Start" Series consists of two diversified ETFs which trade at No Transaction Fees (NTF) at TD Ameritrade. This streamlined approach will allow more of your clients' account to be invested, reducing cash drag, and is ideally suited for accounts under $5,000, especially if receiving regular contributions.
Attached is a fact sheet for the 60/40 version of the Kick Start model, though the same allocation choices as other Series will be available. Note that the equity portion of the portfolio is globally diversified and uses value-, quality-, and momentum factors and is not market-cap weighted. This may result in country- and regional allocations which deviate from global market cap weights.
Model Change Notification: COST NTF (formerly CORE NTF) & CORE
The XYIS investment committee continuously evaluates all model portfolios and their underlying components. Recently, our Chief Investment Strategist, Mario Nardone, CFA, and his team conducted a review of our bond managers and concluded that a change was appropriate in the strategies referenced above. Specifically, we are replacing the Dreyfus/Standish Global Fixed Income Fund (DHGAX) to the PIMCO International Bond - US hedged (PFOAX) in both the Cost and Core models. The decision was more about finding the best fit than a critique of the Dreyfus fund, which has served us well during our holding period. Some rationales for the change are as follows:
1. Our preference for purely non-US exposure rather than a fund which can, at times, heavily invest in US bonds which are already represented in the portfolio,
2. Slightly tighter risk controls such as limits to emerging market and below-investment-grade debt,
3. PIMCO's stellar reputation as an elite bond manager and the confidence their name instills in investors
Model Change Notification: CAUSE DFA
We have expanded the scope of the Cause All-DFA model by adding the DFA Emerging Markets Sustainability Core Fund (DESIX) and the DFA Global Sustainability Fixed Income Portfolio (DGSFX). The addition of these two funds brings consistency to the portfolio, as we now have both the Socially- and Sustainability-focused DFA fund in each eligible investment category.
The commentary contained herein is intended to be general and educational in nature, and is not intended to be used as the primary basis for investment decisions, nor should it be construed as advice designed to meet the particular needs of an individual investor. Nothing contained herein should be considered legal, tax, accounting, investment, financial, or other professional advice, and should not be construed as an offer to sell, a solicitation of an offer to buy, or a recommendation of any security or other financial product or investment strategy. Investors should consult with a qualified professional advisor before taking any action based on this commentary.
Investing in mutual funds, exchange-traded funds (“ETFs”), and other equity and debt securities involve risks, including loss of principal. Any performance data quoted represents past performance. Past performance does not guarantee future results and principal value will fluctuate so that an investor’s investments, when redeemed, may be worth more or less than their original cost. Performance data quoted does not account for any advisory fees imposed by XYIS or any independent and unaffiliated financial planners, or other transaction charges, expenses, taxes, or other fees and costs. Performance of an investor’s actual portfolio will differ from any performance presented.
Investing in foreign securities may involve certain additional risk, including exchange rate fluctuations, less liquidity, greater volatility and less regulation. Small company stocks may be subject to a higher degree of market risk than the securities of more established companies because they tend to be more volatile and less liquid. Bonds are subject to risks, including interest rate risk which can decrease the value of a bond as interest rates rise. REIT investments are subject to changes in economic conditions and real estate values, and credit and interest rate risks.
Investors cannot invest directly in an index. Indexes are unmanaged and reflect reinvested dividends and/or distributions, but do not reflect sales charges, commissions, expenses or taxes.
An investor should consider a portfolio’s investment objectives, risks, charges and expenses carefully before investing. The underlying funds’ prospectus contain this and other important information. Please read any applicable prospectus carefully before investing.
About XY Investment Solutions, LLC
XY Investment Solutions, LLC (“XYIS”), through its partnership with East Bay Financial Services, LLC (“East Bay”), builds investment models through a technology solution, and supports financial planners with investment strategies based on research, experience, and sound rationale. XYIS primarily allocates client assets among various mutual funds and/or ETFs. XYIS may also allocate client assets in individual debt and equity securities, options and independent investment managers. XYIS's services are based on long-term investment strategies incorporating the principles of Modern Portfolio Theory. XYIS manages client investments in portfolios on a discretionary basis.
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