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Asset Allocation & Research

Asset Allocation Process

Our investment process is designed to allow you to meet each of your client’s individual requirements. But it leaves the “final decision” and “fund selection” within your control. AAR has strict investment criteria that requires the investment funds shown to have independent auditors, suitable liquidity, underlying assets that are exchange traded and funds that do not use leverage.

By making research based recommendations, but leaving the final freedom of the investment decision to you, you are able to find the best options for each client’s goals. Discretionary Fund Managers do not give you this flexibility. We do and it’s important not only to allow you to avoid having all your “eggs in one basket”, but also to allow you the advantage of retaining control.

AAR uses a Cautious, Balanced, Growth and Equity Only approach to portfolio construction. With a higher emphasis placed on equities over bonds, the AAR approach can be tailored to suit the individual investor or companies risk appetite.


Investment Holdings Criteria:

AAR employs a broad range of criteria when screening individual holdings before they are considered as part of a model portfolio. This is to ensure that the presented portfolio models provide suitable investment solutions through a straightforward due diligence process.

Any investment vehicle that is researched must meet the following minimum criteria:


A holding must have at least weekly liquidity/pricing to be considered for inclusion within a model portfolio. This is required for easier exit and reporting for the fund. Ideally the team seeks daily priced funds to allow the model portfolio to move quickly between investments, but would consider weekly traded investments.

Performance Track Record:

A fund must be operational and have recorded actual performance before it can be considered for inclusion within a model portfolio. This is to ensure the fund is capable of providing the returns that are being promoted. The team may consider a shorter track record if the fund is deemed a unique opportunity and/or offers early investment benefits.

Fund House Track Record and Minimum Assets Under Management:

Newly launched funds can be invested in, as long as the ultimate parent fund house that administers and manages the fund, has been in operation for at least 15 years or has over $150m asset under management at the time of investment. Exceptions can be made by client request or portfolio manager discretion on a limited basis.

Fund Analysis & Financial Ratios:

A fund is assessed on a number of financial statistics and against its peers and benchmark averages in its relative sector. These include looking at a fund’s past return, historic volatility (risk), Sharpe ratio and R-squared.

Third Party Reporting and Information:

A fund must be registered on third party information and fund screening tools like Bloomberg and Morningstar Analytics.

Fund Due Diligence:

The fund must be regulated and operationally sound.

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