7Twelve
What is 7Twelve?
7Twelve is a blueprint to build a well-diversified investment strategy. Unlike traditional two-asset 60-40 balanced, 7Twelve uses multiple asset classes in an effort to enhance performance and/or reduce risk.
The 7 of 7Twelve represents the suggested number of asset classes to include. The Twelve represents the 12 underlying investments.
Why Diversified?
Most investors are under-diversified. For example, they do not own commodities or real estate despite the fact that these two asset classes make up over 41% of all global investable assets. Holding these together with stocks, bonds, and cash in one inseparable portfolio helps make the world safe for non-traditional assets.
The 7Twelve strategy seeks to provide breadth across seven core asset classes, and diversification depth within each separate fund in the portfolio.
Why 7 Asset Classes?
The 7Twelve strategy uses multiple asset classes to seek to enhance performance and reduce risk.
The traditional equation of two asset classes – U.S. stocks and U.S. bonds – may not add up to greater returns and less volatility.
The long-term success of the 7Twelve strategy may be the result of genuine diversification across these seven core assets.
12 Underlying
7Twelve uses multiple assets: equities, fixed-income, traditional assets, and non-traditional assets--approximately 8.3% each.
There are two ways to invest: predict the market,
or equally-weight. Equal-weighting is the reality
that we cannot consistently pick winners.
Why Indexed based?
At the 15-year horizon in both asset classes (equity and fixed income), there were no categories in which the majority of active managers outperformed (their benchmarks).
Source: SPIVA U.S. Year-End 2023 - S&P Global
The information contained herein is for educational purposes only and is not to be considered investment advice nor a recommendation of any fund, product or investment. Information is obtained from third-party sources which are believed to be reliable, but have not been independently verified. “7Twelve” is a trademark. 7Twelve™, 7Twelve Advisors, LLC, and all strategies, models, adaptations, and products created from said intellectual property are the sole ownership of Craig L. Israelsen, PhD, and/or 7Twelve Advisors, LLC. 3Twelve and 1-2-3 is under the sole ownership of Andy Martin.