KKM Financial and Nasdaq Dorsey Wright launch investible ETF model platform

Jul 9th, 2018 | By | Category: Alternatives / Multi-Asset

Investment adviser KKM Financial, in partnership with Nasdaq Dorsey Wright, has launched the Model Account Platform (MAP), a separately managed account platform which provides access to investible ETF model portfolios powered by Nasdaq Dorsey Wright’s relative-strength expertise.

Nasdaq Dorsey Wright KKM Financial ETF model portfolios

The platform provides access to a range of model portfolios powered by Nasdaq Dorsey Wright’s relative strength expertise.

The platform offers two suites of ETF model portfolios, constructed using universes of either BlackRock iShares or DWS Xtrackers ETFs.

The portfolios have low minimum investments, flat-fees, real-time performance reporting, and intra-day liquidity.

“We are excited to provide investible ETF model portfolio solutions powered by Nasdaq Dorsey Wright,” said Jeff Kilburg, founder and chief executive officer of KKM Financial.

“The innovative investment expertise of Nasdaq Dorsey Wright speaks for itself. This technologically sophisticated separately managed account platform seeks to provide a solution to investors globally. “

“Accessibility to a well-defined strategy and analytics is the first requirement for successful investment” added Jay Gragnani, head of research and client engagement at Nasdaq Dorsey Wright. “With these needs growing among the general investing public, our collaboration with KKM could not come at a better time.”

The portfolios’ investment approaches adhere to the Dorsey Wright core philosophy of relative strength investing. Relative strength in this context compares the price performance, or momentum, between ETFs. According to this philosophy, the absolute momentum of the individual ETF is not as important as the relative momentum between them.

The Dorsey Wright model determines whether momentum is increasing relative to another ETF and assigns a buy signal if it is. The ETFs are then ranked in descending order according to their cumulative number of buy signals with the portfolio rotating to the top-ranking ETFs at each rebalance.

“KKM Financial is taking an important initiative with some of our ‘Point & Figure’ ETF model portfolios,” said Tom Dorsey, co-founder of Nasdaq Dorsey Wright. “Uniquely designed to identify momentum and overall market positioning, these models seek to offer investors access to distinct investment expertise as they look to build diversified investment portfolios.”

There are three portfolios within the suite built from DWS Xtrackers ETFs, offering global, global ex-US, and developed global ex-US investment scopes. Each portfolio selects its constituents from an extensive list of country and regional ETFs, and hedges foreign currency exposure relative to the US dollar.

Within the iShares suite are four portfolios. The tactical rotation and sector rotation models identify the themes and sectors respectively within the US equity market that are showing the greatest relative strength. The fixed income model uses a broad range of bond ETFs, across both sector and maturity, as its investment universe. Lastly, the international model is similar to the DWS portfolios and has a global investment scope.

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