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Risk parity is an investing concept which seeks to provide a lower risk, higher return alternative to the traditional conservative stock & bond portfolio. The classic strategy of 60% stocks and 40% bonds carries 90% of its risk in the stock portion of its allocations. In contrast, the risk parity approach reduces risk by allocating funds to a wider range of asset categories including stocks, government bonds, corporate bonds and real estate, while improving gains through leverage.
In this presentation, Lucena’s Chief Scientist, Tucker Balch, Ph.D. will review the important components of risk parity. He will discuss risk parity performance over the last decade. And he will will show you the logic behind BlackDog, Lucena’s proprietary risk parity strategy.
Rather than trading in individual securities, BlackDog utilizes Exchange Traded Funds (ETFs). Each ETF represents hundreds of securities in a major asset class. Balch will show how market forces ensure that ETF pricing appropriately tracks the value of underlying assets.
If you are having difficulty loading the video, visit the direct link here: BlackDog Webinar: Lucena’s Approach to Risk Parity