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New "Risk Aware" ETF Adjusts Straetgy Based on Market Environment

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Mark Melin
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As quantitative investment methods to solve risk management problems advance, ETFs, considered “passive” investment methods, are a focus for new tools.  But are these new products based on valid and time tested investment principles or are they too complex with multiple opportunities for failure?

Risk aware allocation

State Street Global Advisors developing a risk aware EFT might sound like a product that could have appeared in the Terminator movie series about self aware robots that make decisions in human-like fashion. But this ETF is based on a principle said to be utilized by many well known quantitative hedge funds: adjusting investing strategy based on market environment.

How does the Risk Aware ETF...

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Mark Melin is an alternative investment practitioner whose specialty is recognizing the impact of beta market environment on a technical trading strategy. A portfolio and industry consultant, wrote or edited three books including High Performance Managed Futures (Wiley 2010) and The Chicago Board of Trade’s Handbook of Futures and Options (McGraw-Hill 2008) and taught a course at Northwestern University's executive education program.