PRAG Managed Risk Strategies™
How Much Risk Are You Really Taking?
Many investors believe they are reducing risk by simply diversifying across asset classes both domestically and internationally. Trouble is, most traditional stock and bond classes are becoming more positively correlated. Moreover, the traditional equity asset classes have been nearing perfect positive correlation during major market corrections. Traditional asset allocation, for example, did not protect investors from tremendous losses during the 2008 Financial Crisis. The distinction between aggressive, moderate and conservative risk profiles did not meet the needs of investors because portfolios were not truly diversified with non-correlated assets. With markets that are increasingly volatile, and asset classes that are more correlated than ever, the investment toolkit needs to be rethought.
Enter Milliman Managed Risk Investing, a protection strategy designed to help a portfolio weather difficult and volatile markets. Managed risk investing seeks to reduce risk when risk increases. It's that simple; and that powerful. The animated video below explains in simple terms how the strategy works.
Beyond Asset Allocation
The PRAG Managed Risk Strategies™, in collaboration with Milliman, use mathematical (rules-based) allocation methods to forecast and monitor market volatility, moving between a "risky asset," like stocks, to a "riskless asset" such as cash or cash equivalents. The Milliman approach provides an intelligent portfolio risk management strategy that seeks to:
• stabilize portfolio volatility around a target level,
• capture growth in up markets, and
• defend against losses during sustained market declines.*
Managed risk investing has grown exponentially since its inception following the global financial crisis. Today, managed risk investments totaling more than $300 billion is assets, work collectively to bring fundamental risk management tools to institutions and invdividuals. Large insurance companies that write variable annuities with investment guarantees, asset managers, and large instituional investors rely on managed risk strategies to navigate marktet risk and stabilize volatility.
The PRAG Managed Risk ESG Strategy™, a portfolio of socially responsible and impact investing mutual funds, and the internationally focused PRAG Managed Risk Global ETF Strategy™, both in partnership with Milliman, bring institutional quality risk management to the individual investor.
Milliman: Global Risk Management
Milliman FRM headquartered in the U.S., is a subsidiary of Milliman, Inc. which has some 6 million clients, over 2,300 employees, and 51 offices worldwide. Trading desks in Sydney, London, and Chicago monitor portfolio activities as markets move around the globe.
Find out if one of these strategies is right for you by talking with one of our associates. (see the Domestic and International Associate directories on the left side of this page).
Investing in the PRAG Managed Risk Strategies™ involve risks including the possible loss of principal. The strategies is not intended to be a complete investment program and many factors can affect the performance over time. Investors should carefully consider their investment objectives, along with the risks, charges and expenses of the program. While the strategies are designed to reduce volatility in the portfolio, performance may vary based on when an investor enters the program. There can be no assurance that the goals intended for this program will be attained. Past performance is not a guarantee of future results. The strategies use cash or cash equivalents adjusted dynamically to enhance capital preservation. Talk to one of our advisors for additional information. Participation in this program requires an Investment Management Agreement and an investor risk profile.