What We Do
Capital growth is an important component of any asset allocation framework, and there are several ways in which investors can improve upon the growth engine using alternative strategies that offer additional diversification. First Quadrant’s enhancing solutions aim to capture the anticipated returns from global growth, but with less downside risk and a more consistent return profile, using differentiated approaches. These solutions are generally long-biased and designed to deliver attractive risk-adjusted returns while allowing some correlation to traditional portfolios.

Multi-asset or diversified growth strategies have emerged as an ideal investment solution with a goal to deliver equity-like returns with lower volatility. At First Quadrant, our multi-asset solutions seek to offer a better approach to traditional 60/40 (equities/bonds) or diversified growth investments using innovative portfolio construction techniques, including risk parity, smarter beta and tail-risk management, as well as First Quadrant’s proprietary Market Risk Index to dynamically shift the portfolio according to the current market risk environment. Our strategies are offered in the form of absolute return strategies designed to deliver positive long-term returns irrespective of market direction, alternative beta strategies which utilize non-traditional methods such as risk-based and risk-factor approaches to garner excess return, and in the form of total return solutions which aim to deliver attractive risk-adjusted returns.

Risk-balanced commodities

Commodities are a truly unique asset class. In a long-only context, they are notable for their diversifying effect on more conventional portfolios of stocks and bonds, as well as for hedging unexpected inflation and providing exposure to global growth. First Quadrant’s risk-balanced commodities approach was created to provide greater diversification properties than traditional long-only commodity indices. Risk from rapid price movement in a particular commodity can potentially be mitigated by balancing risk between two or more commodities within a sector. First Quadrant’s approach spreads risk between the commodity sectors to achieve a balanced exposure to the different inflationary drivers, namely economic growth, food inflation, and currency inflation.

Past performance is no guarantee of future results. Potential for profits is accompanied by possibility of loss. Commodities trading involves substantial risk of loss.

Ask us about our alternative approaches to enhancing your returns and growth engines.