We spoke with Samantha*, the Chief Investment Strategist in the Asset Management division of a large national bank* to discuss how the Windham Portfolio Advisor helps her and her team achieve their goals. Samantha and her team are responsible for developing all of the formal strategic and tactical asset allocation recommendations across the asset management business at her company. They develop 10-year and multi-year capital market assumptions and produce thought-leadership content for various publications.

Q: What caused your team to look for a tool like the WPA? What about the WPA stood out to you?

A: There is a seismic shift in the investment management industry. Moving from a more traditional, risk-tolerance perspective on asset allocation to more of a “goals-based” orientation. Rather than asking “what risk tolerance are our clients comfortable with?” we are asking “what is the portfolio positioning clients need to support or achieve their goals?” We needed to evolve with the times and find a more sophisticated modeling software that would help us understand what certain asset allocations can deliver from a reward-risk perspective, as well as what adjustments we might need to make.

We believe in dynamic asset allocation and portfolio management. We’re not “setting it and forgetting it,” but rather we believe that the market is a complex, adaptive system. We needed to take the same approach with our asset allocation recommendations, because what has “worked” in the past isn’t necessarily what will work going forward – the investment landscape is not static. So, for the development of our capital market assumptions over a 10-year horizon, as well as multi-year horizons, in conjunction with the need to be able to model and simulate different asset allocations and evaluate the results in a sophisticated way, that is what really drove us to start looking for tools like Windham.

Q: How does your team use the WPA?

A: We use it extensively in developing our rolling 10-year capital market assumptions. We’ve also used it to create a longer-run set of assumptions for research purposes, which is intended to simulate multiple market cycles and give us more of a neutralized long run (i.e. perpetual) view.

We also use the WPA to build strategic asset allocation recommendations, and ultimately portfolios, for many types of clients. The WPA allows us to gain not only a solid understanding of potential risks throughout the long investment horizon, but also of shortfall risks— which is really important in a goals-based framework. It ultimately helps us have more insightful, and engaging conversations with clients, and that value can add to our credibility.

Q: How else does the WPA help you?

A: One of the key ways that I personally use the WPA is to make better informed decisions when building the framework from which we provide asset allocation recommendations, as well as developing thought-leadership publications using insights from tests we run in the WPA. Analytics from the WPA permeate into every decision we make surrounding our investment process, and asset allocation recommendations. It has been a game changer.

Q: What would these processes look like if you didn’t have the WPA?

A: It’s a critical tool to the process. If we didn’t have the WPA it would be a very manual, very time consuming approach.

Q: What is the most important feature of the WPA for your team?

A: The ability to import custom indexes gives us a lot of flexibility and room to be creative. It’s a key feature to us.

Q: What are three words that describe your experience working with Windham?

A: Responsive, for both the product and also the customer support team. Whenever I have a question, I receive a call or an email back right away. The WPA is very responsive in terms giving me what I need to be able to do, in all of the projects that I do. Insightful is the second word I would use, both for the customer support we receive, and the output we can analyze from the tool itself. The last word is confidence. I have the utmost confidence in WPA’s output, as well as confidence in the team there to support me in a timely manner. That confidence translates to our investment process and asset allocation recommendations that we’re able to deliver to our clients.

*Name and corporation have been changed or removed for privacy and compliance concerns.


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