The Dispatch

Freedom Advisors Now 550 Models, Adding First Trust, Russell, Glenmede, Beacon, and Main

An initial 29 models from money managers First Trust, Russell, Glenmede, Beacon, and Main are now available in Freedom Advisors.

First Trust

First Trust was established in 1991 with a mission to offer trusted investment products and advisory services. The philosophy of the company to work diligently to deliver distinguished products, services and results is carried through in its simple approach to investing. The company was built with these core principles in mind:

• Know what you own
• Invest for the long term
• Employ discipline
• Rebalance, and
• Control taxes

First Trust models provide an allocation strategy based on the best ideas that filter up to the investment committee from its portfolio managers, overlaid with macro views from its chief economist and chief investment officer. First Trust models also allocate to strategies seeking to generate alpha, whether through its enhanced quant AlphaDEX products or its actively managed strategies, which provide a second source of alpha for potential investors.

First Trust models added to the Freedom Advisors platform include:

• First Trust CBOE Vest U.S. Equity Buffer ETF Models
• First Trust Strategic Focus All Equity
• First Trust Strategic Focus Alternatives
• First Trust Strategic Focus Core Plus Fixed Income
• First Trust Strategic Focus Defensive Equity
• First Trust Strategic Focus Diversified Low Duration Fixed Income
• First Trust Strategic Focus Domestic Equity
• First Trust Strategic Focus Equity Income
• First Trust Strategic Focus High Income
• First Trust Strategic Focus High Income Municipal
• First Trust Strategic Focus International Equity
• First Trust Strategic Focus Limited Duration Municipal

Russell Investments

Russell Investments’ Tax-Managed Model Strategies are globally diversified and strategically asset-allocated portfolios with a sophisticated tax-managed investing approach at the core. The models seek to maximize after tax wealth over the long term.

Russell’s active tax-management strategies in its tax-managed equity funds and broad diversification in its tax-exempt bond funds is designed to reduce capital gain distributions over time – managing the tax impact to investors.

The models added to the Freedom Advisors platform include:

• Russell Conservative Model Strategy
• Russell Moderate Model Strategy
• Russell Moderate Growth Model Strategy
• Russell Balanced Model Strategy
• Russell Balanced Growth Model Strategy
• Russell Growth Model Strategy
• Russell Equity Growth Model Strategy

Glenmede Investment Management

Glenmede is an independently-owned boutique asset management company offering actively managed equity, liquid alternative, fixed income, and ESG investing strategies. A major competitive strength of Glenmede’s investment process is use of an objective discipline based on fundamental insights that incorporates favorable attributes from quantitative and fundamental approaches, including:  

• Distinctive multi-factor models for each sector for buying and selling decisions. On an ongoing basis, it refines the models and performs data consistency analysis. In addition, it identifies and tests new factor candidates with insights from internal fundamental teams and active dialogue with street research analysts.
• Each sector model is re-optimized on an annual basis with buy and sell rankings optimized for maximum modified information ratio over 12-month rolling periods based on 20+ years of historical data.
• Leading industry group indicators based on “top-down” economic/capital market leading signals combined with bottom-up stock data, including valuation, fundamentals, estimate-based and technical criteria.
• Proprietary earnings surprise indicator with 20 components that may effectively identify companies that have greater probabilities of negative quarterly earnings surprises.
• Additional downside risk screens, including quality of earnings model, avoiding companies with high idiosyncratic risks, and poor quality/debt ratings (S&P).

Glenmede models now available on the Freedom Advisors platform include:

• Glenmede Quant U.S. Large Cap Core Equity
• Glenmede Quant U.S. Large Cap Growth Equity
• Glenmede Responsible ESG US Equity
• Glenmede Small Cap Equity Model
• Glenmede Women in Leadership US Equity

Beacon Capital Management

With its Vantage 2.0 series of models, Beacon Capital Management attempts to obtain a reasonable market level return by investing equally across all market sectors. It follows the philosophy of Burton Malkiel who believes that each sector responds uniquely to a given set of economic conditions, and that they seldom move in tandem with one another, making them ideal elements for the formation of an asset allocation. It is also Beacon’s belief that an equal allocation of equity sectors can be the most important driver in obtaining consistent long-term performance throughout various market conditions and high market volatility.

Beacon seeks to provide model portfolio management services that strive to meet its three-pillared investment approach: 

• Maximize Diversification - Vantage 2.0 Portfolios invest in 11 Vanguard Sector ETFs and are normally weighted equally to achieve balance.
• Minimize Losses - Vantage 2.0 Portfolios attempt to minimize losses by monitoring the 11 Vanguard Sector ETFs as a group and when that group falls by 10% a stop loss is triggered and the equity assets are shifted to its bond portfolio.
• Maintain Discipline – All Vantage models are mechanical, rules-based strategies. The rules used to manage the portfolios don’t change, which allows clients to clearly understand how their portfolio is being managed and can help to control emotions during volatile markets.

Beacon models added to the Freedom Advisors platform include:

• Beacon Vantage 2.0 Aggressive
• Beacon Vantage 2.0 Balanced
• Beacon Vantage 2.0 Conservative

Main Management Active - US Large Cap

Main Management was founded on the philosophy that sectors are a more efficient way to own equities than single stocks. Accordingly, its Active – US Large Cap strategy uses a disciplined investment process to rank and select market sectors that are trading below their historical averages on an absolute and relative basis. The firm also believes that undervalued sectors typically revert to their mean when the appropriate catalyst is present. A sector will be sold when its price target is achieved. The strategy seeks to derive excess returns from the correct overweight and underweight of sectors relative to the S&P 500 benchmark. The portfolio is implemented using ETFs.

As a fundamental, reversion-to-the-mean manager, fundamental valuations have the most influence over the buy and sell decisions. The macroeconomic environment is also strongly considered in addition to the fundamental valuations. The investment committee actively underweights and overweights sectors relative to the benchmark, which is what drives performance.

These model strategies are now available in the Model Center on the Freedom Advisors platform. Also, your Freedom Advisors Business Consultant is available to help you implement these changes, or contact Advisor Services at support@EQIS.com or (800) 949-9936 and pressing 2.