Global Tactical Asset Allocation (GTAA) Strategy
The BCM Decathlon™ Moderate Tactics SMA strategy is a tactical, global growth portfolio that uses a predictive, quantitative approach and can invest in virtually any investible asset class. Selecting from a prudently managed universe of ETFs, Decathlon’s quantitative system seeks to maximize growth within specific risk parameters.
With the ability to shift away from failing asset classes and seek other opportunities, the system is engineered to provide global growth while seeking to move to more defensive positioning when volatility and/or drawdown is predicted to exceed the risk targets.
The BCM Decathlon Moderate Tactics strategy is optimized to stay within it’s 7-12% target range for maximum drawdown and volatility, while having the ability to seek alpha wherever it may be available.
Predictive, Quantitative and Rules-based Approach Applied to Virtually Every Investible Asset Class
Using pattern recognition technology (PRT), the system analyzes the historical return and volatility data of each ETF in the managed investment universe. The system trades dynamically as market environments and opportunities change, and is designed to create portfolios that have overall drawdown and volatility within the assigned risk targets.
Identify repeating patterns. The PRT is looking to identify repeating patterns within the return and volatility data that it believes will remain present over the next 25 trading days.
Rank ETFs based on patterns. The system ranks each ETF in the investment universe daily, 1 through ~130, based on the desirability of the patterns identified.
Invest in the top 10. When the portfolio is rebalanced, 10 highly ranked, risk-appropriate ETFs are included in the portfolios in 10% equal weights.
BCM Decathlon Strategies
BCM Decathlon Conservative Tactics
7% target for standard deviation and maximum drawdown
50% maximum equity allocation
BCM Decathlon Moderate Tactics
12% target for standard deviation and maximum drawdown
No maximum equity allocation
BCM Decathlon Growth Tactics
16% target for standard deviation and maximum drawdown
No maximum equity allocation
BCM Olympian Dynamic Equity
BCM Olympian Dynamic Equity is an equity only strategy that uses the same system and process as the Decathlon strategies. Instead of ranking and selecting from the entire ETF universe (see more information below on the ETF universe), it selects only from the equity and real estate ETFs.
BCM Decathlon Conservative Aspect*
5.5% target for standard deviation and maximum drawdown
30% maximum equity allocation
BCM Decathlon Moderate Aspect*
10.5% target for standard deviation and maximum drawdown
70% maximum equity allocation
BCM Decathlon Growth Aspect*
14.5% target for standard deviation and maximum drawdown
No maximum equity allocation
*BCM Decathlon Aspect Strategies are only available on the AssetMark™ platform. Please visit eWealthManager for more information, including performance, on the strategies.
Fit within a client account:
Designed to be a global complement to, or a replacement for a portion of, a buy and hold (strategic) asset allocation/portfolio that seeks alpha while concurrently managing risk.
Setting expectations:
Decathlon seeks to provide consistent returns within pre-determined risk parameters over time. Each strategy has an average strategic allocation expected over longer-term periods but can significantly deviate from that over shorter periods.
Strategy objective:
Decathlon is not benchmark centric. The strategies seek absolute return over time while staying within their volatility and drawdown parameters.
Dynamic Trading:
Market trends can extend for months or years or can change in days or weeks. Decathlon employs a dynamic, rules-based trading frequency allowing the system to capitalize on current opportunities or avoid severe risks over shorter periods. However, in lower volatility markets, the strategy may go longer periods without rebalancing.
Decathlon Investment Universe
The Decathlon strategies select from a managed universe of long-only ETFs. The universe consists of over ~130 ETFs carefully selected to provide the system with diverse options to select from, including broad asset classes to focused or niche ETFs. The investment universe consists of:
U.S. Equity ETFs – Broad U.S. equity ETFs as well as sector, industry, style or market capitalization specific U.S. Equity ETFs.
International/Global Equity ETFs – Broad developed international and emerging market ETFs as well as global country, sector, industry, style or market capitalization specific ETFs.
Fixed Income ETFs – U.S., developed international and emerging market bond ETFs across varying credit qualities and maturities.
Alternatives ETFs – Diverse selection of currency, commodity and real estate ETFs.
Risk and control go hand in hand.
In investing, like mountaineering, you need skilled, experienced hands to guide you to your goals.
And reaching those goals often requires you to take calculated risks. The key is to maintain certain safety controls to avoid a large, catastrophic fall.
This principle is built into the BCM Decathlon strategies. While we believe that reducing large market losses is important, it should not be at the expense of seeking significant growth for clients.
Fireside Charts
We look at thousands of charts each week, selecting those that will provoke thought and provide quick insights on just about anything relevant to investors. Follow BCM’s chart blog, Fireside Charts—three times per week, 8-15 charts.
Want to know how you can access BCM’s strategies?
Thanks to current technology, Decathlon is available to virtually any financial professional or institution in one way or another. We would welcome a conversation to find out the most efficient way for you to access us based on your preferences and business model.
Fill out this quick form and we will get back to you with the best method to access the BCM Decathlon strategies, or any of our other strategies that may be available to you.
Or call our consultants at (844) 401-7699.