Current Portfolio Positioning

I've been asked a number of (great) questions regarding portfolio management, and given that many of the same questions continue to come up,  I've built this page to answer them!

Of course, If you have any additional questions about investment philosophy, portfolio allocation or anything else, please reach out!

General Portfolio Information

  1. Our investment philosophy is grounded in sound, fundamental research, the core tenets of which may be found by clicking here.
  2. We are constantly reviewing and comparing our existing holdings with others in the investment universe to reduce expenses and improve risk adjusted returns.
  3. Clients with legacy holdings - holdings other than those in the portfolio models - will experience different results, sometimes to a significant degree, than those with portfolios entirely run by Oak Street Investments.
  4. The portfolio is intended to compensate investors for the risks within the portfolio, and no more or less than the asset classes to which they are exposed.
  5. When a holding is replaced or the portfolio adjusted it may take time for your portfolio to reflect these changes, depending on the types of accounts you hold, your current positioning, tax status, legacy positions and other factors.

Portfolio Management 

The core Oak Street Investments portfolio consists of a blend of 2 portfolios: the equity (growth) and the fixed income (defensive/buffer) portfolios.  Your strategic (long-term) allocation target, i.e., 70% stocks, 30% bonds will determine the weighting for each portfolio.

Equities: Ownership (Stocks/Stock Exchange Traded Funds/Stock Mutual Funds/etc)

The equity portfolio is a low cost, globally diversified portfolio with a small tilt toward value, relative to the benchmark. (This brochure does an excellent job of outlining the basic tenets). The most appropriate benchmark is the MSCI All Country World Index. Ticker ACWI is good proxy for this index, though this model portfolio will always look somewhat different for many reasons, some of which are listed below under current positioning.

Fixed Income: Debt (Bonds/Bond ETFs/Funds/etc)

The Fixed Income portfolio is loosely benchmarked to the Barclays Aggregate Bond Index (US Bonds) and the International Bond Index (Global Bonds), tickers AGG and IAGG represent these indexes well, respectively.

I do not adjust the allocation of the portfolios often, as it is grounded in significant academic research.  More changes occur in the fixed-income portfolio than the equity portfolio.

Current Portfolio Positioning

Equities:  Relative to the ACWI, the portfolio is overweight value, US Stocks, and small cap stocks (the ACWI does not contain any small-caps and has over 40% international).

Fixed Income: Relative to 75% AGG and 25% IAGG, the portfolio is underweight duration (we have a shorter duration than the aggregate) and overweight alternatives (non-fixed income instruments).