GIA believes our job is to create well-diversified portfolios that become less risky over time.  Our portfolios and glide paths are designed to provide the most attractive tradeoff possible between market risk and shortfall/longevity risk.  No portfolio and glide path can sufficiently mitigate both risks. The glide paths we design focus on reducing market risk for participants near retirement.  This approach provides a fiducially sound “product foundation” that enables shortfall risk to be addressed through “investor behavior” tools, such as education, automatic enrollment, automatic contribution increases etc. 

GIA’s investment philosophy is based on over forty years of consulting to defined benefit and defined contribution plans on investment manager selection and portfolio construction. This experience has led to the following components of our investment philosophy for designing target date products for defined contribution plan sponsors and their participants:
  1. Appropriate and regimented asset allocation is the largest contributor to portfolio performance and therefore participant success.
  2. Leadership among asset classes rotates. Broad meaningful exposure to these asset classes and disciplined rebalancing provides more opportunity to gain from the winners and avoid excessive losses from the losers.
  3. Disciplined exposure to the underlying asset classes is best achieved through investments in style pure index based vehicles. This avoids style drift and overlap and mitigates the risk of active manager underperformance over time.
  4. Participants react poorly to even modest downside volatility in their portfolios – locking in losses. The best investment is one a participant will not abandon in down markets but will also provide opportunities for long term capital appreciation. This is best accomplished by focusing on the management of downside risk for participants versus attempting to manage returns.
  5. Transparency and repeatability of the investment process is increasingly important in the Target Date space as a result of the long term nature of the investment and the additional fiduciary considerations if used as a Qualified Default Investment Alternative.
The above components provided the foundation of our first risk based portfolios in 1994, as well as the framework for the design of our current target date products.
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Our Philosophy
Global Index Advisors, Inc.

29 North Park Square, Ste. 201
Marietta, GA 30060
Phone: (770) 874-7042
Fax:     (770) 874-7047

Email: info@globalindexadvisors.com