DRIVERS OF RISK
Source: J.P. Morgan Asset Management as at March 2018. For illustrative purposes only. Opinions, estimates, forecasts, projections and statements of financial market trends are based on market conditions at the date of the publication, constitute our judgment and are subject to change without notice. There can be no guarantee they will be met.
Investors looking for ways to improve portfolio efficiency and mitigate downside risk may want to consider alternative risk premia (also known as alternative beta) strategies.
Offered in lower-cost, liquid and transparent vehicles, these strategies gain exposure to a wide range of risk premia (e.g., equity value, equity momentum, merger arbitrage…) that arise from behavioral biases, structural constraints or rational risk preferences. With very low correlation to traditional asset class returns and to each other, alternative risk premia can enhance a portfolio’s overall risk-return profile.