Risk-managed strategies to meet specific investor needs

Frontier’s Specialty Strategies are risk-managed investment strategies that can either complete an investor’s total portfolio or address a specific investor need. If you’re looking for unconstrained strategies that focus on long-term consistent returns for designated downside risk targets, and aren’t concerned about asset class allocations, consider Frontier’s Absolute Return, Absolute Return Plus or Focused Opportunities Strategies. Or if you’re looking for a diversified capital preservation and income strategy, you may want to look at Frontier’s Conservative Multi-Asset Income Strategy.

Specialty Strategies with a range of risk targets

Each strategy has a long-term allocation* shown in the pie charts below and a maximum one-year loss target, ranging from -2% to -25%. See our strategy detail notes to learn more.

Absolute Return
U.S. Equity
Int’l Equity
Real Assets
Multi-Asset
Fixed Income

Absolute Return

Success rate vs. downside risk target:
94%

Purpose

Based on Capital Preservation strategy, but can invest in any combination of asset classes. Could be used for short-term obligations due within the next 1-3 years, as an alternative to short-term bonds, or for those assets investors do not want or need to be fully exposed to capital market price changes.

Conservative Multi-Asset Income
U.S. Equity
Int’l Equity
Real Assets
Multi-Asset
Fixed Income

Conservative Multi-Asset Income

Success rate vs. downside risk target:
100%

Purpose

Could be used for short-term obligations due within the next 3-5 years, for investors who prioritize expected downside risk and consistency of returns, as well as receiving dividends and income, or for those investors who do not want or need to be fully exposed to capital market price changes.

Absolute Return Plus
U.S. Equity
Int’l Equity
Real Assets
Multi-Asset
Fixed Income

Absolute Return Plus

Success rate vs. downside risk target:
100%

Purpose

Based on the Balanced strategy, but can invest in any combination of asset classes. Could be used to fill an allocation to alternative assets, obligations due within the next 5-10 years, or investors seeking to grow the value of their assets who also prioritize expected downside risk and consistency of returns.

Focused Opportunities
U.S. Equity
Int’l Equity
Real Assets
Multi-Asset
Fixed Income

Focused Opportunities

Success rate vs. downside risk target:
100%

Purpose

Based on the Long-Term Growth strategy but can invest in any combination of asset classes. Can hold up to 100% equity exposure but is actively managed to prioritize downside risk and to seek to improve consistency of returns. Could be used to fill an allocation to equity-oriented alternative asset.

INVESTMENT OBJECTIVES: Absolute Return, Absolute Return Plus and Focused Opportunities are unconstrained global allocation strategies that seek to maximize expected return for the downside risk target. The Conservative Multi-Asset Income strategy seek to maximize expected return for the downside risk target. The Short-Term Reserve strategy is a diversified short-term fixed-income strategy that seeks to generate return while adhering the downside risk target.

* Long-term allocations and downside risk target success rates calculated as of March 31, 2022.

Note: Effective Feb 1, 2022, the Alternative Strategies were renamed Specialty Strategies.

Specialty Strategy key features

The Specialty Strategies offered by Frontier Asset Management may be used to complement core strategies or could be used as the heart of an investor’s portfolio. 

  • Designed to seek the highest return for stated one-year downside risk target
  • Composed of mutual funds from carefully researched institutional, independent money managers
  • Dynamically managed to seek to achieve consistent performance in ever-changing markets

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Notes

Strategy Management Process. Each Frontier strategy consists of carefully selected investment products that are combined in an effort to achieve the Performance Objectives of the strategy. Strategies are managed using a four-step process. First, we establish a long-term asset allocation mix that we call the “Target Long-Term Allocation”. Periodically we adjust the Target Long-Term Allocation based on our changing expectations about the future risk and return characteristics of various asset classes to create the “Target Current Allocation”. Next, we develop an “approved list” of mutual funds that we believe can add value over time. Finally, we test thousands of combinations of mutual funds from our approved list to find the combination that we believe is most likely to perform better than the Target Current Allocation. Over time the investment products in the strategy will change.

Exclusive reliance on the above is not advised. This information is not intended as a recommendation to invest in any particular asset class or strategy or as a promise of future performance. References to future returns are not promises or even estimates of actual returns a client portfolio may achieve. Assumptions, opinions and estimates are provided for illustrative purposes only. They should not be relied upon as recommendations to buy or sell any securities, commodities, treasuries or financial instruments of any kind.  This material has been prepared for information purposes only and is not intended to provide, and should not be relied on for, accounting, legal, investment or tax advice.

Frontier ’s asset allocation models incorporate expectations for future long-term returns and downside risk. The estimates, including expected returns and downside risk, are calculated monthly by Frontier and will change from month to month depending upon factors, including market movements, over which Frontier has no control. They are only one factor among many considered in Frontier’s investment process. They hypothetical in nature and are not intended as guarantees of future returns and should not be relied upon in making investment decisions. All information provided within refers to our model strategies and does not reflect the trading any actual individual account. The estimates and expectations do not consider the impact of advisory fees or transaction costs. Please see Frontier’s ADV Brochure for details on fees.

The “Downside Risk Target” is the lowest return Frontier would expect to encounter over the next 12-months if all the monthly returns fell within 1.645 deviations (95% statistically confident range) of the expected real return. Real return represents the annual percentage return realized on an investment, which is adjusted for changes in prices due to inflation or other external factors.

The “Downside Success Rate vs Downside Risk Target” is the percent of time from the inception of the strategy that the rolling 1-year returns were above our downside risk target. The objective is to be above 95% of the time. It is calculated by taking the composite return, before fees, and determining whether it was above or below that 1-year downside risk target, then taking the average.

Frontier Asset Management is a registered investment adviser with the U.S. Securities and Exchange Commission; however, such registration does not imply a certain level of skill or training and no inference to the contrary should be made.  Additional information about Frontier and its investment adviser representatives is available on the SEC’s website at www.adviserinfo.sec.gov.

Frontier provides model strategies to various investment advisory firms and does not manage those models on a discretionary basis. The performance and holdings of model strategies may vary from the strategies managed by Frontier.

Frontier’s ADV Brochure and Form CRS are available directly on our website www.frontierasset.com or by request, at no cost by contacting us at 307.673.5675 or info@frontierasset.com. They include important disclosures and should be read carefully.