Active Risk


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Active Risk

Active Risk

The risk a portfolio or fund acquires when it is actively managed, especially when its money managers attempt to outperform some benchmark. That is, the more a fund or portfolio differs from the benchmark upon which it is based, the more likely it is to underperform or outperform that same benchmark. This extra risk is active risk.
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it is essential that a uniform level of service, quality level, high visibility, security, active risk and crime prevention work can be offered within all these stations.
While that's not so dramatic, the stock-picking environment remains less favourable than last year, so it "may make sense for fund managers to decrease active risk somewhat," Fraser-Jenkins and team wrote.
"Whether acquiring development projects, negotiating high-value transactions or entering into complex international joint venture deals, all our investments are safeguarded by active risk management," stated the Vice President Banker Investments.
And, the reason some ETFs -- even the so-called "active" ones -- have such lower fees is that they may lack truly active risk mitigation.
Reduce loss of capital: We have found that most retired investors can stay invested down 10-15% in bear market cycles, but usually not more, so active risk management to minimize loss is critical.
Many investors do harm to their portfolio, exposing themselves to active risk positions where the rationale for the position was not completely well understood, or the decision behind it was based on faulty data or a faulty process.
"It also assumed in its base scenario that the Central Bank will continue its active risk management and that rating agencies will not downgrade Lebanon's sovereign ratings below the 'B minus' level."
"Active risk management led to a strong capital ratio of 200 percent under Solvency II rules, leaving us well prepared for today's volatile markets."
We see the key, and long overdue, changes as: the calculation of solvency and minimum capital requirements, the compulsory independent review of solvency and technical reserves, more focus on active risk management, as well as the introduction of more structured investment portfolios with maximum asset exposure limits.
In the last issue, Gen Carlisle discussed the importance of always following the rules (and ensuring those around you do as well) and using active risk management.
It was cited by The Lawyer as one of only 38 UK law firms in 2013 to have advised on a merger or acquisition for an AIM-listed company, when it helped lead the PS12 million acquisition of Active Risk Group by Sword Group.
"As part of our active risk management program, we seek to balance our guaranteed and non-guaranteed business to avoid a concentration of exposure to any single product type in any one year," said Mike Wells, Jackson National's president and CEO, in a statement.
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