cfm Risk Management Portfolio Design Structure
The cfm risk management hub effectively operates as a risk management platform assessing risk at individual strategy level as well as on a consolidated portfolio basis. This process takes into account risk offsets across strategies in order to optimise risk adjusted returns.
Key risks are tracked both intraday and over variable time series. Essentially the risk hub dictates portfolio profiling in order to optimise returns. It is essential to not only track individual strategy performance but also style, market conditions, daily trading ranges, market volatility, momentum shifts, scenario risk exposure, and most importantly changes in correlation within the portfolio. The whole concept is based on proactive portfolio management and the avoidance of shocks. This diagram illustrates how this is applied to our Constellation Fund. Risk/Reward ratios can be adjusted to meet individual clients return requirements without increasing the core relative risk profile.
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