StashAway sent out an email earlier today that they will be re-optimising our portfolio (except the Income portfolio) to an All-Weather strategy. If you are wondering what is this strategy, we will have to go back to their ERAA framework which invests and make asset allocation decisions based on the economic regime.

The All-Weather Portfolio

What happens to StashAway portfolios when economic data are not clear? If growth is 0.1%, is this “positive enough” to invest in a growth-oriented portfolio? If growth is negative 0.1%, is the right thing to do to have a defensive portfolio?

In the face of unclear economic data, ERAA® first looks at the momentum (rate of change) of growth and/or inflation to see if there is clear guidance on direction. If the momentum is not solid enough to provide predictive guidance, ERAA® resorts to adjusting clients’ portfolios to an All-Weather strategy that is specifically designed to simultaneously protect capital and