After market volatility hit in the fourth quarter of 2018, Envestnet | PMC decided to look at the first four months of 2019 to see how many of the 96,000 advisors on its platform had readjusted their portfolios. The answer: Not that many, but some made surprising moves.
One interesting finding was that there wasn’t a lot of growth in large-cap and S&P 500 type of investments, “which was good,” Brooks Friederich, director of research strategy for Envestnet | PMC, told ThinkAdvisor. He explained that overweighting of large-cap domestic and growth investment has been the usual case in this cycle.
“That was a little surprising,” he said. “And a good surprise. They aren’t performance chasing, they aren’t just continuing to own domestic large-cap, but [instead] building and managing diversified portfolios.”
One style of investment that didn’t do well was liquid alternatives, which showed the largest outflow of advisors. Friederich said that wasn’t such a surprise as those products, which include managed futures, global macro, equity market neutral, leveraged and inverse, had “subpar” performance.