INvestment Philosophy
When it comes to Investment Managment we truly believe our approach and style of building a portfolio is what sets us apart, making our Investment Management First Class in every way.
When investing we take a holistic approach centered around the classic, time tested philosophy of diversifcation, but have elaborated to this broad concept by taking it to a higher level through makings sure each assets is 'uniquely uncorrelated' to help complement and optimize the overall portfolio. We start by implementing a top down investment approach, first analyzing macro-economic factors and working all the way down to individual securities, searching for the highest reward to risk ratio, that the market has 'fundementally' undervalued which can provide 'asymetic returns'. All this while considering how each security may 'uniquely correlate' in the overall portfolio also helping to protect from risk.
When investing we take a holistic approach centered around the classic, time tested philosophy of diversifcation, but have elaborated to this broad concept by taking it to a higher level through makings sure each assets is 'uniquely uncorrelated' to help complement and optimize the overall portfolio. We start by implementing a top down investment approach, first analyzing macro-economic factors and working all the way down to individual securities, searching for the highest reward to risk ratio, that the market has 'fundementally' undervalued which can provide 'asymetic returns'. All this while considering how each security may 'uniquely correlate' in the overall portfolio also helping to protect from risk.
.jpg)
What does all this mean?
Correlation is simply how one assets moves in direction to another.
Building a portfolio, which takes into account each assets correlation to one another, is simply diversifcation taken to a higher level. We are able to 'quantify the correlations' of each asset and see how each asset complements one another within the portfolio to optimize diversification. This protects against market risks to the overall portfolio, which helps to mitigate risk of loss, while still continuing to target maximizing return on Investment. Driving a higher reward to risk ratio.-------------------------------------------------------------------------------------------
Building a portfolio, which takes into account each assets correlation to one another, is simply diversifcation taken to a higher level. We are able to 'quantify the correlations' of each asset and see how each asset complements one another within the portfolio to optimize diversification. This protects against market risks to the overall portfolio, which helps to mitigate risk of loss, while still continuing to target maximizing return on Investment. Driving a higher reward to risk ratio.-------------------------------------------------------------------------------------------
How do we do this?
We have partnered with a top Investment Management company which provides "portfolio software' to analyse and create a visualization of the the assets within the portfolio to make sure the portfolio is optimized and protected against 'market risk'.
.jpg)
How is this Different? Why is it special?
Most advisors simply diversify through sprinkling different 'Stocks/Bonds/Mutual Funds' through different sectors, countries, or use style boxs of 'small medium large' 'value, blend, growth' companies, or use Target Date funds, and this is a good start. But it simply does NOT optimize diversification.(as you can see in the box above)
When you are able to quantify the correlations, you can optimize the portfolios, thus going above and beyond the competition, and allowing for better risk protection.
Really Getting into the Weeds:
Traditional flaws in how investment managers view risk?
Risk can be measured many ways, but is traditionally measured as 'volitility'(variance, standard deviation or various other formula based metrics that calculate a positions expected movement in either direction).
Simply put, there are inherent flaws in using these metrics as a target to construct and manage a portfolio. Aiming soley to shrink volitility, weeds out assets with more upside potential, shrinking potential returns. Thus why so many managers may perceive it as 'risk or reward' as if every security in the market is 'perfectly efficent', which they are not. And soley using these metrics could potentially even leave a portfolio open to 'correlated market risks'.
But by Targeting Diversification using correlations and optimizing it through quantifiying it via the 'intra-portfolio correlations score', we are still able to help protect against volitility while still targeting higher returns, getting the best of both worlds.
Summary:
-Use top down appraoch starting with macro-economic factors of countries>sectors>all the way down to invdividual companies to chose best available 'fundementally valued' assets with asymentic reward probablity
-Construct portfolio to Optimize Diversification
-Balance & Rebalance accordingly
All with the Goal of protecting against risk and aim to maximize gains