Core-Satellite Strategy
Definition
What is Core-Satellite Strategy?
A portfolioThe complete collection of investments owned by an investor or managed under one mandate. structure using a diversified low-cost core plus smaller active or specialised holdings.
Example in practice
How This Looks in Practice
An index fundA fund designed to track the holdings and performance of a stated market index. forms 80% of the portfolio while sector funds make up the satellites.
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Related Terms
Portfolio
The complete collection of investments owned by an investor or managed under one mandate.
Portfolio ConstructionPortfolio Construction
The process of selecting and combining investments to meet return, risk, liquidity, and time-horizon objectives.
Portfolio ConstructionStrategic Asset Allocation
A long-term target mix of asset classes based on an investor's objectives and constraints.
Portfolio AnalyticsCorrelation
A statistic ranging from minus one to plus one that describes how two return series move together.