Perspective

The strength of strategic asset allocation

When it comes to building model portfolios, there are benefits to taking a strategic view.

By: Hannah Commoss Mia Kafoury

Updated: 4/10/2026

Key Takeaways

Strategic approaches to asset allocation apply modern portfolio theory and long-term return projections to determine allocations within a portfolio, seeking to allocate assets along the efficient frontier.
Greater diversification can lead to higher risk-adjusted returns, as shown by movement along the efficient frontier.
Disciplined and regular rebalancing can help improve risk-adjusted returns over time by reducing volatility and mitigating the impact of market drawdowns
We believe that building portfolios using a strategic asset allocation framework, that also incorporates rebalancing, is an effective way to balance risk and return for a wide range of investors.

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