Risk Parity – A Superior Approach or a Flawed Model?

In recent years, the “risk parity” approach to asset allocation has won converts with significant fund inflows and, until recently, very good performance. The basic idea of a risk parity strategy is to spread risk equally across different asset classes in a portfolio. For example, if bonds are innately less risky, one can own a […]

Balancing Act: Investing in a Deleveraging Cycle

As we enter the second quarter of 2012, markets are looking up. The Super Bowl Index and the January Effect have proven to be true so far, and the stock market has experienced the best first quarter since 1998. However, economically speaking, we are not out of the proverbial woods yet. Despite significant gains, we are still in the midst of a “balance-sheet recession.”

Weathering the Storm: Investing in an Uncertain Environment

In the weeks since Washington increased the debt limit, the markets have been a roller coaster ride. Continued fallout from the political debacle of early August and disappointing data from housing, manufacturing and employment sectors have all come together to create the perfect storm for a double dip recession. At Balentine, we have spent the last 18 months preparing portfolios for such an event and are positioned to weather the storm, by including protection from a sustained low interest rate environment, the threat of inflation and the economic struggles of the developed world.

Risk Management and Muni Bonds

Risk is a component of almost every aspect of human life. In some situations, risks are relatively minor and have potentially little impact. In other, more serious situations, risk can pose dangers to life and livelihood.