The Current and Future State of Model Portfolios

This article is relevant to financial professionals who are considering offering model portfolios to their clients. If you are an individual investor interested in WisdomTree ETF Model Portfolios, please inquire with your financial professional. Not all financial professionals have access to these Model Portfolios.

In early May, I recorded a podcast for the “GBI (Goals-Based Investing) Podcast Series” with Tony Davidow. Tony is the author of the recently published book, Goal-Based Investing: A Visionary Framework for Wealth Management, and is the host of the GBI Podcast series.

Tony and I both sit on the Editorial Advisory Board for the Investments & Wealth Monitor, a periodic industry journal of the Investments & Wealth Institute (IWI, formerly known as IMCA), that publishes on a wide variety of investment and wealth management topics. Tony is a former Chair of the IWI Board of Directors, where I am a Board member and current Vice Chair of Standards.

In this 15-minute podcast, Tony and I discuss a variety of topics. We begin with an overall assessment of the current market environment—what have been the drivers of recent market performance, and where do we think we go from here? Given the current “in favor” status of value and dividend-oriented stocks, we believe the WisdomTree products and models are very well positioned for this environment.

We then discussed technology and its role in driving increased advisor adoption of third-party model portfolios. Specifically, we consider how the availability of internal and third-party trading platforms, ease of implementation and use, and increased functionality have driven increased advisor interest and adoption of model portfolios.

We then turned our attention to inflation and what advisors and investors should be thinking about with respect to allocations that may help hedge the rising risk of inflation. We share our respective views on the current and future expectations for inflation, how that is impacting portfolio performances, and then share some ideas on how advisors may want to think about positioning their portfolios going forward.