Investors need to be preparing for the next downturn now, precisely
because predicting the timing of such an event is near impossible,
and we know that our starting point in terms of valuations is
ominous. Investors need to be thinking about how to build portfolios
in a materially different way from what they have done historically.
Traditional risk mitigators like investment grade debt will likely be
unable to be nearly as effective as in the past, given current yields. We
believe that investors need to be reducing risk at this point in the cycle,
both equity risk and interest rate risk, and one tool that can help to
accomplish that goal is long/short equity.
There are no guarantees that any strategy will be successful.
The views expressed are those of the author at the time created. These views are subject to change at any time based on market and other conditions, and 361 Capital disclaims any responsibility to update such views. No forecasts can be guaranteed. These views may not be relied upon as investment advice or as an indication of trading intent on behalf of any 361 Capital portfolio.
This 361 Capital article is not intended to provide investment advice and should not be construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any security by 361 Capital or any third-party. You are solely responsible for determining whether any investment, investment strategy, security or related transaction is appropriate for you based on your personal investment objectives, financial circumstances and risk tolerance. You should consult your legal or tax professional regarding your specific situation.