A question I was asked recently was as follows: “My financial advisor works at a large firm and said his firm runs two sets of models: tactical and strategic. What’s the difference and what should I go with?”
So, Generally speaking, a tactical model means the folks who are managing the portfolio are making more frequent changes depending on market dynamics and the economic environment. In essence, they are trying to time the market based on short-term data. Strategic models, on the other hand, tend to be more of a "buy-and-hold" philosophy, where changes are made less frequently. Tactical sounds better, after all, who doesn’t want to take advantage and capitalize on short-term market moves. However, practically speaking, the short-term moves they make won't work out since no one knows where the market will move over the near-term. Advertising that a portfolio manager will be more tactical, is just a sales pitch that is likely to fall flat. Furthermore, this type of portfolio management, with all it’s additional trading will undoubtedly be more tax inefficient due to the more frequent trading. For those reasons, a strategic model is one that I would probably favor.
Unfortunately, I can't say definitively which one the questioner should go with, without understanding their specific goals and looking at the actual portfolios that are being recommended to them, but from my experience a “strategic” approach should usually win out.