Multi-Asset Indices Can Help With Buy/Sell Decisions

ESBGMV Index targets the minimum variance multi-asset portfolio for GBP-based investors.
Systematic asset class adjustments offer insight to traditional and ETF-based investors.
Compared to 4q17, the index's biggest switches as at 1q18 have been from European High Yield Bonds and UK Equity to European Aggregate Bonds and Gold.

Risk-based indices are different to factor-based indices, as they focus on the interaction between securities, not the characteristics within securities. Put simply, it's an alternative, systematic approach to asset allocation and risk management.

The Elston Multi-Asset Min Volatility Index (ESBGMV) launched in 2014 represents the minimum variance multi-asset portfolio for GBP investors.

As it takes a systematic approach, it's always interesting to see the asset-class switches that this methodology triggers via its monthly readjustments.

Comparing the index composition from 4q17 to 1q18, the biggest switches have been cutting back European High Yield Bonds and UK Equity, whilst adding to European Aggregate Bonds and Gold.

For more information, see http://www.elstonconsulting.co.uk/indices.html

Comments

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