Put Alpha Risk Solutions At The Center Of Your Core/Satellite Strategy
Alpha Risk’s tactical risk-management methodology helps you manage money through the investment market’s many cycles. In the quest to achieve investors’ desired outcomes, Alpha Risk Solutions offers a new, systematic approach to investing.
Utilizing a proprietary mathematical model – an algorithm – Alpha Risk periodically signals buy and sell suggestions to investors:
- Proprietary binary algorithm measures probable relative price performance on thousands of mutual funds, stocks, and exchange traded funds versus cash
- The Alpha Risk model uses price, price dislocation, volatility and scores of other factors to deliver buy/sell signals for any security with a ticker symbol
While the underlying program is sophisticated, the output of the Alpha Risk rules-based engine consists of one of two simple binary signals:
“1” to Buy
“0” to Sell
If at any time fewer than four sector ETFs are generating a “buy” signal, assets are deployed to cash.
In our back-testing model, for example, for 3/20/2008, Alpha Risk recommended positions in only three sectors: Consumer Staples, Energy and Materials. Accordingly, 25% of assets were deployed to cash.
With Alpha Risk Solutions Tactical Sector Selection Can Add Value To Portfolio Performance
Defensive signals may include a shift to cash and greater exposure to Materials, Energy, Consumer Staples, and/or Health Care sectors. Conversely, in the most optimistic scenario, all nine sector ETFs will be generating buy signals and the strategy will be fully invested.
In effect, an algorithmic, indexed-based tool box, ARS provides a highly flexible vehicle for tactical decision-making.
By signaling “1 to Buy,” “0 to Sell,” Alpha Risk Solutions can help a portfolio:
- Tilt toward the market sectors that are currently the most attractive
- Steer clear of those sectors that display “red flags”
- Ride out small storms by holding fast to those sectors showing the most promise
- Exit the market when indicators signal potential for extremely negative conditions