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Risk Parity

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Risk Parity

A strategic asset allocation strategy providing diversified, risk-balanced exposure to global markets.

  • Seeks to deliver strong absolute and risk-adjusted returns by investing in a broad range of global asset classes including equity, fixed income and real assets
  • Liquid, transparent strategy diversified by asset class, risks and economic environment
  • Advanced forward-looking risk models combining volatility, correlation, tail risks and other risk measures

Overview

Strategy Advantage

Diversified

Liquid, transparent strategy diversified by asset class, risks and economic environment

Differentiated

Advanced forward looking risk models combining volatility, correlation, tail risks and other risk measures

Disciplined

Strategy employs a disciplined and dynamic investment process that seeks to deliver well-diversified strategic exposures (no tactical tilts)

Experienced

Team has a track record of award winning research and attractive returns

 


Our Style of Risk Parity

The Neuberger Berman style of Risk Parity is diversified by asset class, risk premia, risk type, time and regular rebalancing.

Risk Allocation

Sample Portfolio Weights

 


 

Investment Process

Select Investment Universe
  • Seek assets from three categories of risk premia that are liquid and diversifying
Set Target Risk Weights
  • Set target risks by balancing both across and within asset classes
  • Incorporate liquidity and regulatory considerations
Forecast Risk
  • Multi-dimensional volatility, correlation and tail risk assessment
  • Longer-term forecast horizon
Implement and Monitor
  • Determine the exposures (dollar weights) that we believe would deliver intended risk targets and scale to achieve the target volatility
  • Monitor daily and rebalance monthly or as market conditions warrant

Management

Hakan Kaya, PhD
Senior Portfolio Manager
14 Years of industry experience
13 Years with Neuberger Berman
David Wan
Portfolio Manager
19 Years of industry experience
19 Years with Neuberger Berman