We offer a diverse range of investment strategies, including fixed income, equity, and global multi-asset class solutions.
Innealta’s proprietary framework was created, and has been refined, over a period of 15 years. At its core, the model is designed to provide expected risk/return information. This information is used to determine attractive environments and dynamically tilt asset class exposures to capitalize on favorable investment opportunities. Innealta’s framework parses through hundreds of empirically proven variables across three broad categories, including:
-
Corporate Fundamentals – financial statement metrics (earnings, relative price, profitability, dividends, market capitalization, and others)
-
Macroeconomics – health of financial markets (monetary policy, the term structure of interest rates, expected inflation, personal consumption, credit spreads, and others)
-
Behavioral – Momentum/market conviction metrics are used to quantify the strength of market movements
Each of these datasets provides information at varying speeds and, when used in conjunction, can increase the reliability of the risk/return expectations.
The framework is not a short-term trading model. It is used to inform our portfolio management decisions and is designed to uncover long-term trends across various asset classes.
-
Exchange traded funds (ETFs) provide investors with a single, tradable security for gaining exposure to an index. In the U.S. alone, ETF assets under management have grown to nearly $8.3 trillion as of the end of 2023.
A critical component of our investment process is, of course, to seek the best set of ETFs for each asset class in the investment discipline. A proprietary framework is used to examine the structural integrity and the investment metrics of each ETF in the marketplace.
We review the assets managed by the ETF, in addition to the normal dollar volume liquidity of the ETF, in the context of:
-
The size of the market and the liquidity of the underlying asset class the ETF represents
-
The likely size of the position we intend to establish
-
The sophistication of the ETF provider
We work closely with the most sophisticated ETF providers as part of this process.
-
The strategy considers investment among 11 U.S. sector equity markets, based on the Investment Committee’s determination of the prospective risk-relative reward scenario, versus fixed income, for each. When not invested in a particular sector equity market, funds are invested in a portfolio of fixed income and other asset classes for which the Investment Committee maintains a more favorable risk-reward outlook.
The strategy considers investment among more than 40 country equity markets, including more than 20 emerging markets, based on the Investment Committee’s determination of the prospective risk-relative reward scenario, versus fixed income, for each. When not invested in a particular country equity market, funds are invested in a portfolio of fixed income and other asset classes for which the Investment Committee maintains a more favorable risk-reward outlook.
The Dynamic Global Diversified (DGD), or The Global All Asset (GAA), strategies provide exposure across six major assets classes: equity, fixed income sovereign, fixed income credit, commodities, foreign exchange, and real estate. Widening the scope of potential investments provides the opportunity to spread risk across different asset classes and geographies. The Innealta quantitative framework analyzes the variables relevant to each sector and sub-sector within a given asset class, and provides the Investment Committee insight on the various inter-asset relationships, intra-asset relationships, and the reward to risk profile.
