By definition, systematic risk cannot be diversified away. Therefore, at Swan, we believe if you can’t diversify away systematic risk, you must hedge it away.
The goal of this study is to show how hedged equity, through an investment vehicle such as the DRS, can be superior to traditional asset allocation or help enhance it. The results are intriguing.
This white paper also highlights 13 popular, well-known asset allocation strategies and illustrates how an allocation to the DRS could offer favorable absolute and risk-adjusted returns.