Our investment philosophy is that the asset allocation decision is the most important step in portfolio construction. As such, BPC uses a quantitative approach to determine the optimal mix of asset classes to create broadly diversified investment portfolios that typically include exposure to U.S. and international stocks, fixed income securities, real estate and cash.
Our Approach to Investment Management
BPC emphasizes global diversification in order to reduce risk and improve portfolio returns. We first start with the asset class review to determine which assets will be considered for inclusion into the portfolio. We analyze long-term data to determine expected volatility (risk) for each asset class as well as analyzing its historical behavior (correlation) in relation to other asset classes.
Expected returns are then measured and adjusted according to current economic and market conditions. Following the asset class review, a mean-variance approach is taken to determine the optimal allocations to each asset class, focusing on maximizing return for a given level of risk.
BPC is Your Investment Management Partner
Each Client engagement will entail a review of the Client’s investment goals, financial situation, time horizon, tolerance for risk and other factors to develop an appropriate strategy for managing a Client’s account. Once the client’s desired risk-profile is determined, the portfolio is monitored and rebalanced, usually quarterly, or when necessary, to keep the risk profile relatively constant. To employ this strategy, BPC Advisors typically utilizes exchange-traded funds, market-tracking mutual funds or index-based mutual funds. BPC may retain certain types of investments based on a Client’s legacy portfolio construction.