|
|
|
|
| |
PHILOSOPHY | |
 |
|
|
|
| |
| |
|
For years, the only way
for Pension Funds, Endowments, Foundations and
Wealthy Families to gain access to absolute return
strategies, was through highly specialized alternative
investments, such as hedge funds.
Absolute Investment Advisers is playing a part
in changing that trend by providing absolute return
strategies in an easy-to-use investment vehicle;
the open end mutual fund.
This section of the site was created to explain
what Absolute Return Investing is all about, why
it is used and how it can provide added diversification
to a portfolio.
The Goals of
an Absolute Return Strategy:
1) Reduce Volatility; focus on risk-adjusted returns
2) Low sensitivity (beta  )
to traditional market indicies
3) Deliver positive (absolute) returns by avoiding
large drawdowns*
4) Access to skilled managers. (pursuit of alpha
)
This section explains these objectives and provides
valuable information about why the Absolute Strategies
Fund was created.
* There is no assurance that any absolute return
strategy will be successful
|
| |
| |
Definitions:
Beta is the measure of a portfolio's relative sensitivity
and correlation to an index (overall market, benchmark,
peer group, etc.). By definition, the beta of an
index is 1.00, so that a portfolio with a 1.10 beta
is expected to perform 10% better on average than
the index in up markets and 10% worse in down markets.
The returns of low beta portfolios are more independent
of the returns of an index.
Alpha is the difference between a portfolio's average
returns and those of an index (overall market, benchmark,
peer group, etc.), after adjusting for differences
in market correlation as measured by Beta. The difference
is expressed as an annualized percentage. |
|
|
