In the current market conditions, investors are looking for more than just average returns. They are looking for protection against downside risk and the ability to generate alpha. While the question of how to best construct a portfolio has no one-size-fits-all answer, certain best practices can help advisors build a better portfolio.

In this episode, Rusty and Robyn talk with Paul Ma, Vice President and Lead Portfolio Strategist at Fidelity Institutional Asset Management. Paul and his team at Fidelity focus on helping advisors build a better portfolio.

Paul talks with Rusty and Robyn about the trends in portfolio construction and diversification, how he builds a better portfolio, and how to adapt the classic 60/40 portfolio to the current environment.

Key Takeaways

• [02:56] - Paul's career history and how he came to join Fidelity.
• [03:50] - How Paul helps advisors build better portfolios.
• [04:42] - Paul's key message to financial advisors and investors in today's market.
• [05:25] - Paul's recommendation for rebalancing.
• [06:52] - Is the classic 60/40 portfolio dead?
• [07:42] - The role inflation plays in a 60/40 portfolio.
• [08:50] - The latest trends advisors use to go beyond stocks and bonds.
• [11:31] - Fidelity's benchmark for liquid alternatives and real assets.
• [12:52] - Paul's personal investment strategy.
• [13:48] - How Paul maintains his physical and mental health to perform at his best.
• [14:34] - The people Paul is grateful for professionally.
• [15:34] - Paul's recommendation for content.

Quotes

[04:07] - "We try to help advisors be more forward-looking because one of the biggest mistakes advisors make is by whatever's working, looking backward. And we are open architecture and find the best breed names from different fund families to help advisors build a better portfolio." ~ Paul Ma

[07:13] - "I hear people say that 60/40 is dead almost every year for the last decade. And they were wrong. 60/40 was awesome for two decades, with a sharp ratio much higher than a hundred percent equity sharp ratio." ~ Paul Ma

[11:05] - "The most famous disclaimer in finance is that past performance is no predictor of future performance. Being contrarian, we are moving into a different era of higher inflation. So, new era, new asset classes like commodities and liquid alts." ~ Paul Ma

Links 

• Fidelity Institutional
• Fidelity Investments
• Waterfalls by TLC
• BlackRock
• Putnam Investments
• Quarterly Market Update 2022 | Fidelity

Connect with our hosts

• Rusty Vanneman
• Robyn Murray

Subscribe and stay in touch

• Apple Podcasts
• Spotify
• Google Podcasts

2158-OPS-11/9/2022