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September 25, 2019 edited
Hello Anjelika,
When an Initiative shows up in the incorrect level in the schedule it usually indicates that one or more of the source projects that are set as an issue source are coming from a Next-Gen project, as currently Portfolio is only compatible with the Classic project types, and the parent child issue mappings break when a next-gen project type is is used.
While you can set up a plan connected to a a next-gen project, the above mentioned hierarchy mappings will not function as well as various other configurations will not function covered in the following KB in more detail: