The purpose of a well-thought out investment process is two-fold: helping investors reach their goals and, secondarily, making the investment experience a clear, comfortable one.

You may be familiar with Market Cycle Mandates, the three-mandate diversification process we’ve used for years at Orion Portfolio Solutions to help advisors prepare their clients to handle any market scenario. Our belief in that process hasn’t wavered. But through the guidance of our investment committee, we’ve identified an opportunity to better execute the second purpose of the well-thought out investment process: helping advisors communicate three-mandate diversification to their clients to create a more comfortable experience.  

Effective earlier this month, the underlying mandates were adjusted as follows:

Updated mandate naming conventions on the Orion Portfolio Solutions platform

  • Beta: Strategies designed to capture movement of the markets
  • Active: Strategies that adjust for changing market conditions through active management
  • Diversifier: Strategies designed to disengage from market movement and provide new sources of potential return and risk  
We believe that the newly named Market Cycle Mandates will help investors more readily connect the importance of each distinct mandate in the investment process with its role in market movement, which is the primary driver of portfolio return variance. That belief in the impact of market movements on portfolio performance is the catalyst for the three-mandate investment process, which relies on diversification across three investment types. These investment types, or mandates, provide different levels of market participation, active management, and uncorrelated performance.

Placing an emphasis up front on the three mandates accomplishes three important things:

  1. Makes it easier for investors to connect the role each mandate plays with their long-term success
  2. Helps investors more readily adhere to their objective investment strategy throughout varying market conditions, which often leads to greater investment success
  3. Provides you with a clear way to continue educating your investors and keep them committed to a well-planned investment portfolio
We’re committed to continually evaluating and improving our investment products, methodologies, and services. For more information about recent and upcoming enhancements to our platform, click here.

If you’d like to learn more about Orion Portfolio Solutions, don’t hesitate to contact us! 

 

1847-OPS-07/21/2020