Lars Jaeger says ARP is not reliant on any particular event, environment or trajectory of economic growth.
Thursday, July 30, 2020
What does this mean for your asset class?
Alternative risk premia (ARP) is an investment type, or an asset class, that does not depend on particular macroeconomic environments. It does not necessarily need a rising equity market or a certain type of environment in the credit or bond markets. It is a well-diversified strategy, and its underlying performance drivers depend on a variety of factors. We believe this is an advantage of ARP – in itself, it is diversified with respect to market environments. ARP would not be severely affected in the event of, for example, a rough patch in the equity market. On the other hand, it would not necessarily benefit if the equity market were to strongly rise. It is an independent asset class that does not rely on any particular event, environment or trajectory of economic growth.
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