Balanced Portfolio is an ETF portfolio​​​ designed to collect risk premiums across liquid assets in various economic environments. The firm built the framework for the new portfolio on the idea of four economic environments: prosperity, inflation, deflation and recession. The asset target weights are calculated by multiplying the economic environment weight with the assets’ weights, which are all set to equal, the firm said.

“We have created the Balanced Portfolio strategy to engage traders, and in addition ETFs have become a cost-effective investment option to gain broad market exposure. By implementing the strategy themselves, the costs incurred are minimal and only related to executing the trades and the total expense ratio annualised on the ETFs. We have designed this new approach to address the demands of our more long-term oriented clients, and to protect investors from unpredictable events in the market of which we have seen so many of late,” said Peter Garnry, head of equity strategy at Saxo Bank.

The Balanced Portfolio consists of seven asset classes: large cap equities, emerging market bonds, commodities, gold, corporate bonds, long-term government bonds and inflation-linked government bonds. These are tracked by seven liquid ETFs traded on US exchanges, and asset allocation will be published on a monthly basis on Tradingfloor.com.

The Balanced Portfolio is based on US-denominated ETFs, however a Balanced Portfolio based on European denominated ETFs will be launched later this month, the firm said.

In other recent developments, last month Saxo Bank launched Saxo TV on TradingFloor.com, a new tool that provides on-demand business and financial analysis to traders, led by former Bloomberg TV news anchor, Owen Thomas.