The Value Proposition Pairing long-only equity exposure with a diversified, trend-following managed futures portfolio may generate an attractive risk adjusted return. Access to this combination in a mutual fund structure may assist advisors in building holistic solutions for clients across the spectrum of sophistication, many of whom may not be able to achieve the benefits of full equity exposure plus full trend following exposure without this structure.
Equal-weighted equity and trend-following portfolio maintains full equity market exposure, while adding tail risk mitigation during periods of market dislocation.
Crisis mitigation is derived from the unique statistical characteristics of trend-following, which are emphasized by Aspen’s trend-following program.
Market Demands This strategy provides a unique complement to the traditionally constructed portfolio. Advisors are in a never-ending search for strategies that will perform well during equity bull markets while also providing a measure of diversification during equity bear markets.
Addresses an unmet need for client portfolios: a trend-following allocation with the potential to "move the needle."
Methodology Summary Aspen has developed a proprietary methodology that combines long US equity exposure with an approximately equal amount of exposure to its diversified, trend-following managed futures program. Every dollar invested gets exposure to one dollar of long equities and one dollar of our systematic trend following program.
The strategy’s 100% + 100% structure provides access to returns of both asset classes, but low equity/trend-following correlation results in portfolio volatility similar to that of equities alone.
Captures the "Crisis Alpha" benefits of trend-following: a tendency towards pronounced gains during equity market stress, which can reduce drawdowns experienced by a stand-alone equity exposure.
Aspen manages both the equity and trend-following exposures with a fully systematic, rules-based approach.