Risk Control Methodology
- The BIRR Approach to Controlling for Economy-Wide Surprises
Our approach to controlling for unexpected changes in long- and short-term interest rates, inflation, the real growth rate of the economy, and market sentiment
Is the market properly valued?
On average investors are rewarded for the risks they undertake. Click on one of the choices below to see a graph comparing the cumulative return attributable to these rewards for risks with the actual historical return for the S&P 500 in earlier periods or the FTSE USA index in the most recent period. Cumulative returns are computed over a five-year period for a $1.00 initial investment, with dividends reinvested. The BIRR risk factors for which investors are rewarded include economy-wide surprises in interest rates, inflation, the real growth rate of the economy, and market sentiment.
- Using Macroeconomic Factors to Control Portfolio Risk (PDF format - 420 KB)
- The BIRR Equity Risk Model (PDF format - 1.3 MB)
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