The Risk Report: Analysis Reveals 6 Common Drivers of Unexpected Results
Learn about the 6 common drivers of unexpected portfolio results uncovered during our four-year, aggregated global analysis of more than 200 institutional equity portfolios.
Any time someone invests, they do so with a specific outcome in mind. But as the saying goes, the best laid plans often go awry. When portfolios don't deliver what's expected, the number one question is “why?”.
Northern Trust Asset management has been on a mission to help investors answer that very question by providing them with a unique analysis into the risks impacting their portfolios. Our quantitative expertise and a heritage rooted in portfolio construction gave investors a new lens and perspective. After doing in-depth analyses for investors and their consultants, common themes emerged.
We compiled our findings to help other investors avoid surprises in The Risk Report, which reveals six key discoveries driving unexpected results, such as the magnitude of uncompensated risks, the toll the cancellation effect took on active risk, and that a conventional style box construction approach is actually one of the leading causes of the cancellation effect. Other findings include hidden risks, like style bets, bring with them unintentional exposures. Diversification can backfire. And the cost of possible timing attempts. With volatility and uncertainty on the rise, this research is especially timely. Learn about all of our discoveries to avoid unexpected surprises. Get The Risk Report.