We just shipped our first two model portfolios

What's a model portfolio?

A model portfolio is a template we apply to actively manage investment accounts on your behalf.

Why would I be interested in a model portfolio?

When you put money into our models, you get the same exact investments we use to manage our own money.

Our goal at Prospero Wealth is to earn your trust by investing your money the way we manage our own—we're committed to keeping the bulk of our discretionary assets in the same models we've created for you.

What's available right now and what's coming soon?

Right now, we offer "long-short" and "growth" models. We expect to ship an "income" model soon.

Long-Short

In 2018, volatility returned to the market—this is normal—and a long-short strategy is a great way to put some shock absorbers on the ride, ideally without sacrificing total returns. Our Long-Short model kicks off as 90% long, 30% short, 10% cash. This means the strategy has a 60% net exposure to the market. We make money when our longs go up and our shorts go down, and if we pick well, we end up with market-like returns without the volatility. These allocations will change, potentially quickly, as we close out faster-moving shorts and adjust to market conditions. Our longs, however, are held with our standard buy-and-hold philosophy. We expect annual turnover within our long portfolio to be 20% or less. An anomalous year won't force us to stay rigidly fixated on that, but you should expect low turnover.

Growth

Our growth model kicks off with the following allocations: 45% US holdings, 40% International holdings, 10% alternative holdings, and 5% bonds. Like our Long-Short strategy, we expect annual asset turnover to be 20% or less (outside of an occasional anomalous year, perhaps). Our strategy is to buy right and let our winners ride, so there will absolutely be fluctuation in the allocations over time.

Income (coming soon!)

Keep your eyes peeled for this one. We're working on a model that balances high-yielding assets with great businesses paying growing dividends. The goal is to create a strategy where the principal grows with inflation (or better), while the dividends and income provide much higher rates of return than you can find in high-yield savings accounts. We're going to try and have our cake and eat it too.

In closing

Thanks for being a part of our journey at Prospero Wealth. If you believe in us, what we're doing, and the fundamental precept that advisors should be highly aligned with their clients, the highest compliment you could pay us would be to forward this along to a friend who should hear it.