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How do Core portfolios work?

Core portfolios are designed to provide diversified exposure across global markets through a mix of equities, bonds, and gold, all invested via exchange-traded funds (ETFs). These ETFs give investors access to various sectors and asset classes, helping each portfolio stay balanced and resilient under different market conditions.

Portfolio Construction Methodology

Syfe’s Core portfolio strategy is built on three key principles:

  1. Asset Class Risk Budgeting
  2. Smart Beta
  3. Stable Asset Allocation

For more details, refer to our portfolio methodology.

Core Portfolio Options

You can choose from four Core portfolios based on your investment goals, time horizon, and risk appetite:

  • Core Defensive
  • Core Balanced
  • Core Growth
  • Core Equity100

Each portfolio varies in its mix of equities, bonds, and gold providing different levels of potential return and risk exposure.

Understanding Factor Investing

Factor investing sits between passive and active investing. While passive funds track broad indices like the S&P 500 at low cost, and active funds attempt to beat benchmarks through stock-picking (often with higher risk and fees), factor investing focuses on specific characteristics or “factors” that explain long-term performance differences among securities.

Common factors include:

  • Value: Stocks trading below their intrinsic worth
  • Size: Smaller-cap companies with higher growth potential
  • Quality: Firms with strong profitability and stable earnings

These factors, supported by decades of academic research (e.g. Fama-French studies), help improve risk-adjusted returns over time.

A Simple Analogy

Think of investing like buying a car:

  • The passive approach is like buying a standard model, reliable and cost-effective.
  • The active approach is like modifying every part of the car, potentially faster, but riskier and more expensive.
  • The factor-based approach is like upgrading key parts, better tires, fuel, and brakes to improve performance and safety without sacrificing reliability.

Factor investing applies this same philosophy to help investors achieve better performance while maintaining diversification and stability.