Defined Risk

For investors, the biggest risk is the possibility of losing big and not having the money they need when they need it.

 

We seek to define risk, or limit the risk of loss, so investors may be better positioned to achieve long-term goals.

Risk Redefined

The industry measures risk as volatility, or price swings up and down.

 

The industry’s conventional view is that investors are risk-averse, yet research into investors behavior shows investors are actually loss averse.

So we measure risk as the amount of loss using drawdown or the Pain Index.

 

In this way, our approach to risk management is aligned with what concerns investors the most: losing big.

We believe a hedged equity strategy that seeks to “define,” or limit risk on an annual basis to avoid large losses is the best way to help long-term investors remain on track toward their goals.