Overview

We build portfolios for long-term investors. All our portfolios have a few things in common.

  • Diversification. Global diversification can improve performance and control risk.
  • Objectivity. We put the interests of clients first. We avoid conflicts of interest.
  • Balance. We balance our understanding of history and research with real-world experience.
  • Elegant Simplicity. Leonardo Da Vinci said, “Simplicity is the ultimate sophistication.”
  • Low Cost. Controlling costs and expenses allows clients to keep more of what they earn.
  • Discipline. Our well-defined process allows us to better navigate both good and bad markets.
  • Patience. Success in investing takes time. We are willing to wait for our ideas to bear fruit.

Our Starting Place

In 1952, Nobel Prize winner Harry Markowitz developed a theoretical process for building portfolios designed to provide the highest level of return for any given level of risk.

In 1958, Nobel Prize winner James Tobin hypothesized that there is only one “super-efficient” portfolio that provides the best possible combination of risk and return—all others fall short.

In 1964, Nobel Prize winner William Sharpe concluded that Tobin’s super-efficient portfolio is the “global market portfolio.” The global market portfolio is the portfolio that represents how all the investors in the world have allocated their assets among risky assets.

Many practitioners have used this research to conclude that the best portfolio for an individual is the super-efficient, global market portfolio, adjusted up or down to the appropriate risk level.

We use the global market portfolio as the starting place in constructing all our portfolios, adapted to the specific objective of each strategy.

Our Portfolios

At First Ascent, we offer two series of portfolios: the Global Explorer and the Global ETF series. Both include portfolios at five risk levels ranging from 20% equity to 100% equity and are available in tax-sensitive versions.

Global Explorer Series

The Global Explorer series are core-plus-satellite portfolios that combine both passively and actively managed funds so that clients get the benefit of both investment styles.

Global ETF Series

The Global ETF series use only passively managed exchange-traded funds (ETFs) and are managed to track a fixed asset allocation target. This gives clients the lowest cost access to broad diversification among global securities markets.

Global Explorer Series

We build and manage the Global Explorer portfolios for long-term investors
using a core-plus-satellite approach.


Core

Each Global Explorer core is the foundation of the portfolio and provides broad diversification among global securities markets. Each core consists of low-cost exchange-traded funds (ETFs) that track domestic and international stock and bond markets.

Satellites

We may add satellites to a portfolio to complement the core. Satellites may consist of actively managed mutual funds or passively managed index funds or ETFs. Satellites give us the possibility to add value for clients through active managers.

 

The goal of adding a satellite is to benefit from an asset class, skilled manager, or specialized strategy that may improve returns, create a new source of diversification, or offer additional downside protection within the portfolio.

Asset Allocation

We have defined a baseline target asset allocation for each of our portfolios that defines the proportion of equity and fixed income as well as the proportion of US and international assets. We may adjust any of these targets by plus or minus 5%.

We offer the Global Explorer portfolios at five risk levels ranging from 20% equity to 100% equity.
We also offer tax-sensitive versions of all Global Explorer portfolios.

Global ETF Series

The Global ETF portfolios are built and managed to provide long-term investors
with broad, cost-effective diversification among global securities markets.


Passive Approach

The Global ETF series are designed for clients who prefer a fully passive approach to investing, and are built using low-cost exchange-traded funds (ETFs) that track domestic and international stock and bond markets.

Asset Allocation

We keep the composition of the Global ETF portfolios elegantly simple to minimize costs to clients. The Global ETF portfolios track a fixed asset allocation target and do not include actively managed funds.

We offer the Global ETF portfolios at five risk levels ranging from 20% equity to 100% equity.
We also offer tax-sensitive versions of all Global ETF portfolios.

Ten Beliefs Underlying Our Investment Process

  • Remain humble.  No one can consistently predict the future. There are simply too many variables that affect what actually happens.
  • Don’t confuse likelihoods with certainties.  It is possible to calculate probabilities, but there are no guarantees.
  • Be prepared for the unexpected.  History can provide insights about the future, but don’t expect it to repeat itself.
  • Academic research finds “truth” by looking backwards. Always consider how it will translate into the real world of tomorrow.
  • Good ideas can take time to mature.  Knowing that something will happen is not the same as knowing when it will happen.
  • Controlling expenses is important.  Reducing fees, transaction costs and taxes can significantly improve results.
  • It is difficult for active managers to add value. Measuring their value requires the right tools. Reaping their value requires patience.
  • Diversification works.  But over reliance on systems that “optimize” diversification exalts math over reality and results in excess costs.
  • Emotion is the enemy of good investment decisions.  Discipline is important. Experience, judgment and restraint are mandatory.
  • Every portfolio has an investor attached to it. A portfolio is not just the results it produces. It is also the experience it creates.