The Dispatch

Supplement Portfolios with These Models if the Market Rally Worries You

If you believe that the market rally has reintroduced sell-off risk and you are looking for ways to protect clients, consider these alternative strategies that may be able to handle expected volatility and help in lowering standard deviation of a portfolio.

The American Beacon AHL Managed Futures Fund utilizes advanced quantitative models and systematic trading techniques aiming to capture profit opportunities arising from market inefficiencies and trends while actively managing risk. This strategy is designed to generate attractive risk-adjusted returns over the long term.

One of the key strengths of the fund is its ability to adapt to changing market conditions. The team at AHL constantly researches and refines its models to ensure they remain effective and robust in different market environments. This dynamic approach enables the strategy to identify and exploit potential opportunities across a wide range of futures markets, including equities, bonds, commodities, and currencies.

Furthermore, AHL’s investment process is driven by a strong focus on risk management. The team employs rigorous risk controls and continuously monitors the portfolio to mitigate downside risks and preserve capital. This disciplined approach aims to deliver consistent returns while effectively managing market volatility, as seen in this chart:

The Diamond Hill Long-Short Fund is managed by a highly skilled and experienced team with a long track record and a dedication to fundamental research. Diamond Hill has established itself as a respected name in the investment industry.

The long-short equity strategy aims to deliver attractive risk-adjusted returns by identifying both long and short investment opportunities in the equity markets. The team at Diamond Hill employs a rigorous bottom-up approach, conducting in-depth fundamental analysis to uncover companies with compelling investment theses. By combining long positions in companies it believes are undervalued with short positions in those deemed overvalued, the strategy seeks to capitalize on market inefficiencies and generate alpha.

What sets the Diamond Hill Long-Short Fund apart is its emphasis on risk management. The team employs a disciplined process to evaluate and monitor risks, including thorough assessment of company-specific risks and a comprehensive portfolio risk analysis. This risk-conscious approach aims to preserve capital and deliver consistent performance across market cycles.

Contact your Consulting Team to find out more about these models or click on the model name in the Freedom Advisors Model Center where you will find extensive information.