THE EMERALD HYBRID STRATEGY

OUR OBJECTIVE:

Produce a consistent stream of positive (absolute) returns with low market correlation over a minimum rolling 3-year time period.

We begin with the idea that the assets investors place under our care are not to simply accumulate, but to fund their future and/or current lifestyle. Many people do not want to see tremendous fluctuation in the possibility that they will achieve their desired lifestyle. It follows, then, that their portfolio should be designed to keep fluctuation in value low, while still maintaining the potential to grow at a competitive rate. We believe that for most people, investment success is about getting what they want out of their money, not about beating a market index. Thus, most investors can benefit from allocating a portion of their funds to low volatility, absolute return strategies - those which seek to make money in a variety of market environments, not only in strong markets.

TRADITIONAL INVESTING meets HYBRID INVESTING

Traditional asset allocation is a useful tool, but it has many flaws. Too many asset classes tend to look like each other over time. Other periods of market history have often shown similar results. Since we don't know in advance whether Small Cap Value, International Growth or something else will perform the best in the next decade, we must ask "is there an alternative or complement to this traditional approach?" This inspired us to expand our work on Hybrid investing.

Our conclusion: diversifying stocks with other stocks does not always add value to the investment process. Therefore, many investors need to look beyond traditional stock and bond investment styles in their portfolio.

Click Here to See Our Research Study on This

The Bottom Line:

Adding Small Cap and International Stocks to Large Cap Stocks does not significantly change the behavior of your portfolio. Diversification is helpful when done in a thoughtful way. When its done based on mistaken "conventional wisdom" it is best described as "DE-WORSE-IFICATION." There is a better way to diversify. Let us show you how.