The Value of Tactical Asset Management

 

Tactical asset management is a response to today’s Wall Street reality. It is an active type of asset management that adjusts allocations across different asset classes and market sectors.

 

The theory is that active rebalancing of a portfolio can help an investor exploit market volatility & short-term performance momentum. Instead of sitting back and waiting for stocks to move higher, this approach moves assets in and out of sectors to try and profit from present and near-term conditions.

 

Tactical asset management is dynamic and adaptive and can use relative strength metrics to evaluate stock and fund performance in light of macro factors. It is a style of asset management that makes a lot of sense in today’s stock market.

 

A tactical asset management strategy may also help to mitigate market losses and realize better returns. This dynamic, responsive approach keeps macro factors in mind and makes a lot of sense today as the “buy and hold” approach seems ill-suited to these times.

 

Tactical asset management can utilize many technical market indicators, and may help improve a portfolio’s performance. It may be an alternative to the “buy and hold” approach.