Strategic Portfolios

Our process for creating strategic investment portfolios synthesizes our economic and capital market research with the client’s tolerance for risk and desire for return. We are intensely focused on risk management in the construction of our portfolios with a goal of providing competitive results in rising markets while protecting capital in challenging markets. Manager selection and monitoring is an important ingredient to utilizing active investment management throughout our strategies. Below are the fundamental elements that go into developing our portfolios:

Macro-Economic Analysis

  • Focus on competitive advantages/disadvantages within the global economy
  • Assess government balance sheets, fiscal and monetary policies and trade balances in an effort to understand their impact on economic growth and, importantly, interest rates and currency valuations

Capital Markets Research

  • Focus on absolute valuations and relative valuations across asset classes
  • Identify the relative risk and reward opportunities available in global markets
  • Build portfolios with the highest possible return for a given level of risk
  • Assessment of risk is our first priority

Proprietary Return and Risk Expectations

  • Proprietary expected returns and volatility levels are developed for each asset class utilizing economic and capital markets research

Manager Selection

  • A quantitative screening of managers identifies managers with a history of providing attractive returns while protecting capital in down markets
  • After our qualitative screen is complete, an in depth qualitative due diligence process is conducted to identify managers with a consistent stable approach to investing

Portfolio Monitoring

  • Blue Water’s Investment Committee meets regularly to discuss manager performance, effectiveness, and evaluate portfolio positioning
  • Quarterly phone calls and reviews of mangers are conducted to analyze fund activities