The key to successful capital market investments is not to search for information – it lies in the intelligent processing of such information.
Quantifying and managing capital market risks is a key element of GET Capital's investment approach. GET Capital's portfolio is built on the traditional asset classes.
We use Expected Shortfall as a measure of risk. This concept is not based on the assumptions of a normal distribution of returns or stable correlation parameters. Quite the opposite, in fact – our calculations fully account for statistical interdependencies and extreme events (so-called 'fat tails') such as market crashes.
In addition to the risk parameter, a return estimator is determined for each portfolio asset. The portfolio is optimised daily, using these parameters as well as individual risk budgets and also taking transaction costs into account.
The result of this process is an optimal asset allocation (providing an optimum risk/return ratio), given the defined investment universe.
The objective of the chosen investment approach is to use your specific risk budget over time in the most intelligent way – taking the various capital market events into consideration – in order to enhance your risk-adjusted performance.