FPI FUNDLINK

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A passive core is not enough

A traditional, passive core portfolio can do a good job of exposing investors to returns from a variety of asset classes. And simple asset-class diversification can be an effective tool against “baby bear” markets—short, shallow market declines of less than 20%.

But asset-class diversification seems to work best when investors need its averaging influences the least. When markets experience “grizzly bear” markets (deep, persistent declines of 20% or more), the diversification investors count on for protection can disappear.

Retirees, pre-retirees, and those taking withdrawals can be hit especially hard by these “grizzly bear” markets. Simple market math illustrates that the deeper the decline, the longer the recovery.

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Prepare for the next bear with dynamic risk management

Helping clients reach their financial goals can be challenging enough without limiting portfolios to inflexible buy-and-hold strategies with only one defensive tool. Investors need a portfolio that can continuously—dynamically—respond to market changes with several defensive tools that aim to smooth out market volatility while also seeking growth opportunities.

Can your clients’ existing portfolios do what a dynamically risk-managed portfolio can?

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Respond automatically to changes in market conditions.

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Offer multi-strategy diversification among asset classes, investment methodologies, and time lines.

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Employ multiple levels of risk management—helping to mitigate steep losses in bear markets.

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Smooth volatility, helping clients avoid market extremes.

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Take advantage of the opportunities for growth that are present in most market environments.

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Keep fees low, while offering a sophisticated, dynamically risk-managed, and fully diversified investment solution.

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Allow clients to track progress against a custom benchmark tied to their suitability profiles.

3 ways to activate your core

We offer three different ways to have a core portfolio using American Funds, each designed to equip investors with the investment methodologies and tools to address the risks and opportunities present in every market environment. American Funds have a reputation for reliability and quality, which is why Flexible Plan Investments (FPI) is proud to offer actively managed solutions in combination with them.

SUITABILITY-BASED
Alpha Beta Combo with American Funds (AFAB)

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Designed to deliver a strategically diversified and robust core-and-explore portfolio by applying FPI’s allocation methodology to both a universe of the top-performing equity and income asset classes of American Funds and FPI’s QFC Multi-Strategy Portfolios (QFC MSP), a risk-managed blend of FPI’s QFC Multi-Strategy Core and QFC Multi-Strategy Explore strategies.

Factsheet

SUITABILITY-BASED
Evolution with American Funds (AFEV)

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A dynamically risk-managed investment strategy that aims to invest in the top-performing equity and income asset classes of American Funds in accordance with suitability-based risk profiles.

Factsheet

TACTICAL
Classic with American Funds (AFC)

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Classic with American Funds (AFC) applies FPI’s tactical asset-allocation strategy to a universe of American Funds. The strategy is designed to use fundamental, monetary, technical, sentiment, and momentum indicators to identify intermediate-term to long-term market trends.

Factsheet

Active management positions

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Bull Market
Seeks to keep the strategy invested in the leading equity funds. Uses short-term and long-term price trends to rank funds monthly.

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Sideways Market
Seeks to avoid whipsaws by using equity funds, bond funds, and longer-term historical measurements.

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Bear Market
Seeks to avoid underperforming funds. Can move to defensive positions, including money-market positions, when market conditions are unfavorable.