The ClearBridge Dynamic MDA U.S. Dividend Balanced Portfolios strive to maximize simplicity and minimize emotion by shifting allocations across multiple ClearBridge strategies based on a quantitative system that uses well-known factor measures and methodologies.
Seeks income and long-term capital appreciation through diversification across multiple ClearBridge strategies to gain exposure to a mix of value stocks, dividend-paying stocks and bonds.
- Simplify asset allocation through the efficient delivery of a diversified model portfolio geared toward a specific growth objective
- Take the emotion out of rebalancing by relying on a quantitative-based dynamic allocation system that relies on market-driven signals to change allocations
- Pair the operational experience of ClearBridge Investments, a deeply seasoned MDA investment manager, with what ClearBridge considers to be their best ideas in growth and dividend-paying stocks
- Portfolios are invested across three ClearBridge strategies: Appreciation, Dividend Strategy and Investment Grade ETFs.
- The strategy band range was chosen specifically to help keep turnover low, which may improve the tax efficiency of the portfolios, yet wide enough to maintain the benefits of dynamic allocation.
Active qualitative oversight
- Ongoing monitoring of asset allocation
- The active management for which ClearBridge is recognized remains very relevant throughout the process. In fact, ClearBridge Co-Chief Investment Officers must confirm and approve all allocation signals and changes.
Simplified portfolio administration
- By keeping all investment managers, service and operational functions within one organization, ClearBridge believes they can deliver an efficient and effective experience.
- Positions are consolidated into one account, one statement
- Allocation shifts are communicated regularly with full transparency
Diversification does not guarantee a profit or protect against a loss.
There is no guarantee that the Portfolio's objectives will be met.
MDA disciplines may utilize Exchange Traded Fund (“ETFs”) disciplines. An ETF is a type of Investment Company whose investment objective is to achieve a return similar to that of a particular market index. An ETF will invest in either all of the securities or a representative sample of the securities included in the index they track. ETFs may be bought or sold throughout the day in the secondary market, but are generally not redeemable by retail investors for the underlying basket of securities they track. Clients likely to find an MDA strategy that utilizes ETF disciplines most appropriate are those willing to accept market-like returns for the ETF discipline with little potential for the individual ETFs to outperform the indices they track. Potential investors should understand that the annual advisory fee charged in the MDA program is in addition to the management fees, operating expenses, and other expenses associated with an investment in ETFs.
Identify complementary strategies to build a single, diversified portfolio
- Combine different ClearBridge strategies using appropriate reallocation triggers and weights with the goal of generating higher risk-adjusted returns (as measured by sharpe ratios) than the underlying products or an equal-weighted combination.
Review allocations monthly
- The portfolio will shift allocations based on a predetermined factor signals based on trailing 12-month moving average relative to a base index. For the ClearBridge Dynamic MDA U.S. Dividend Balanced Portfolios, the factor is based on Asset Class (stocks vs. bonds).
- Allocation changes are triggered when the value of a factor is above or below the index's 12-month simple moving average for two consecutive months.
Confirmation of signal
- All allocation signals and changes require review and approval from ClearBridge co-CIOs
- Independent risk management at both strategy and portfolio level
The investment process may change over time. The characteristics set forth above are intended as a general illustration of some of the criteria the strategy team considers in selecting securities for client portfolios.
The investment process and models used by ClearBridge to determine the Dynamic MDA portfolios’ allocations to their constituent strategies are subject to change. In such event, a Dynamic MDA portfolio’s allocations may differ from the possible allocations set forth above. A Dynamic MDA portfolio’s allocations also may vary from the allocations set forth above due to market movements and the relative performance of its constituent strategies. A Dynamic MDA portfolio’s allocations in effect from time to time will be within the allocation bands set forth in the description of the ClearBridge Dynamic MDA portfolios in ClearBridge’s and Legg Mason Private Portfolio Group’s combined Form ADV brochure.
Meet Your Manager
With a legacy dating back over 50 years, ClearBridge Investments is a leading global equity manager committed to delivering differentiated long-term results through authentic active management.
Active share is a measure of the percentage of stock holdings in a manager's portfolio that differs from the benchmark index.
What I Should Know
All investments involve risk, including loss of principal and there is no guarantee that investment objectives will be met. Equity securities are subject to price fluctuation and possible loss of principal. Investments may be made in small- and mid-cap companies, which involve a higher degree of risk and volatility than investments in large-cap companies. While most investments are in U.S. companies, investments may also be made in ADRs and other securities of non-U.S. companies in developed and emerging markets which involve risks in addition to those ordinarily associated with investing in domestic securities, including the potentially negative effects of currency fluctuation, political and economic developments, foreign taxation and differences in auditing and other financial standards. These risks are magnified in emerging markets. MDA Portfolios invest in stocks and bonds, which are subject to risks, including possible loss of principal. Fixed income securities are subject to interest rate and credit risk, which is a possibility that the issuer of a security will be unable to make interest payments and repay the principal on its debt. As interest rates rise, the price of fixed income securities falls.
The performance shown is final and was updated on April 28, 2020.
IMPORTANT INFORMATION: Past performance is no guarantee of future results. Management and performance of individual accounts may vary for reasons that include the existence of different implementation practices and model requirements in different investment programs.
Pure Gross performance shown does not reflect the deduction of investment management fees and certain transaction costs, which will reduce portfolio performance. Net performance includes the deduction of a 3% annual wrap fee for equity and balanced portfolios and a 1.5% annual wrap fee for fixed income portfolios. These deducted fees amounts are the maximum anticipated wrap fees. Actual fees may vary. For fee schedules, contact your financial professional or, if you enter into an agreement directly with Legg Mason Private Portfolio Group, LLC ("LMPPG"), refer to LMPPG's Form ADV disclosure document. Returns reflect the reinvestment of dividends and other earnings.
An investor cannot invest directly in an index. Unmanaged index returns do not reflect any fees, expenses or sales charges.
Please see GIPS® endnotes for important additional information regarding the portfolio performance shown and for effects of fees.
Performance Source: Legg Mason
Hypothetical growth of dollars: For illustrative purposes only. Assumes no withdrawals or contributions. The performance results shown were calculated assuming reinvestment of dividends and income and take into account both realized and unrealized capital gains and losses.
IMPORTANT INFORMATION: Separately Managed Accounts (SMAs) are investment services provided by Legg Mason Private Portfolio Group, LLC (LMPPG), a federally registered investment adviser. Client portfolios are managed based on investment instructions or advice provided by one or more of the following Legg Mason-affiliated sub-advisers: ClearBridge Investments, LLC. Management is implemented by LMPPG, the designated sub-adviser or, in the case of certain programs, the program sponsor or its designee.
Professional money management may not be suitable for all investors. Factual information relating to the securities discussed was obtained from sources believed to be reliable, but there can be no guarantee as to its accuracy. It should not be assumed that investments made in the future will be profitable or will equal the performance of the securities discussed in the material.
Holdings, sector weightings, market capitalization and portfolio characteristics are subject to change at any time and are based on a representative portfolio. Holdings, sector weightings, market capitalization and portfolio characteristics of individual client portfolios in the program may differ, sometimes significantly, from those shown. This information does not constitute, and should not be construed as, investment advice or recommendations with respect to the securities and sectors listed.
Total Return (Net, %)
Total Return (*Pure Gross, %)
Benchmark Return (%)
|% of Bundled Fee Portfolios in the Composite
||Composite Dispersion (%)
3 Yr. St. Dev. (%)
3 Yr. St. Dev. (%)
|Total Composite Assets at End of Period (USD million)
Percentage of Firm Assets
|Total Firm Assets at End of Period (USD million)
*Pure gross of fee returns do not reflect the deduction of any expenses, including transaction costs, and are presented as supplemental to the net of fee returns.
n/m - Information is not statistically meaningful due to an insufficient number of portfolios in the composite for the entire year.
ClearBridge Investments, LLC claims compliance with the Global Investment Performance Standards (GIPS®) and has prepared and presented this report in compliance with the GIPS standards. ClearBridge Investments, LLC has been independently verified for the periods January 1, 1997 - December 31, 2018. The verification reports are available upon request.
Verification assesses whether (1) the firm has complied with all the composite construction requirements of the GIPS standards on a firm-wide basis and (2) the firm's policies and procedures are designed to calculate and present performance in compliance with the GIPS standards. Verification does not ensure the accuracy of any specific composite presentation.
ClearBridge Investments, LLC ("ClearBridge") is a wholly owned subsidiary of Legg Mason, Inc. ("Legg Mason"). The investment advisory business now known as ClearBridge was registered in September 2005 to facilitate Legg Mason's acquisition of substantially all the equity asset management businesses known as Citigroup Asset Management. These former businesses serve as the foundation of ClearBridge and its claim of GIPS compliance for institutional accounts through predecessor firms, effective as of January 1997. In June 2008, ClearBridge combined this business with its retail business to form a single GIPS firm. As of April 1, 2013 and January 1, 2016, ClearBridge's affiliates, Global Currents Investment Management, LLC, and ClearBridge, LLC, respectively, have become part of the ClearBridge GIPS firm.
The ClearBridge Dynamic MDA U.S. Dividend Balanced Portfolio SMA composite consists of discretionary wrap accounts with an account minimum of US $150,000. Accounts within the composite seek income and diversification utilizing a mix of U.S. stocks and bonds. The strategy is implemented by Legg Mason Private Portfolio Group, LLC (LMPPG). LMPPG claims compliance with the Global Investment Performance Standards (GIPS®). LMPPG has been independently verified for the periods January 1, 2013 - December 31, 2018. LMPPG is a wholly-owned subsidiary of Legg Mason, Inc and together with its sub-advisers, including ClearBridge, provides investment services primarily in investment programs sponsored by Sponsor Firms. To obtain a compliant presentation and/or the firm's list of composite descriptions, please contact email@example.com. The main risks of this strategy are General Investment Risk, Small Cap Risk, Mid Cap Risk, Non-U.S. Investment Risk, Credit Risk, Interest Rate Risk, Illiquidity Risk, and Asset Allocation Risk. The composite is comprised of 100% non-fee-paying seed capital.
Input and Calculation Data:
The fee schedule currently in effect is 3.00% on all assets. Net of fee composite returns are calculated by reducing each monthly composite pure gross rate of return by the highest "bundled" fee charged (3.00%) annually, prorated to a monthly ratio. The "bundled" fee includes transaction costs, investment management, custodial, and other administrative fees. The internal dispersion of annual returns is measured by the asset-weighted standard deviation of portfolio returns included in the composite for the entire year. The three-year annualized ex-post standard deviation is not available prior to 2018 because the composite does not have 36 months of data. A list of composite descriptions is available upon request. Policies for valuing portfolios, calculating performance, and preparing compliant presentations are available upon request. Past performance is not necessarily indicative of future results.
The composite benchmark is 70% S&P 500®; 30% iBoxx $ Liquid Investment Grade index.
The S&P 500® Index is a broad-based measurement of changes in stock market conditions based on the average performance of 500 widely held common stocks.
The Markit iBoxx USD Liquid Investment Grade Index is designed to provide a balanced representation of the USD investment grade corporate market and to meet the investors demand for a USD denominated, highly liquid and representative investment grade corporate index.
All investments involve risk, including loss of principal. Past performance is no guarantee of future results. Please see each product’s webpage for specific details regarding investment objective, risks, performance and other important information. Review this information carefully before you make any investment decision.