Portfolio Construction & Risk Management

The Azimuth Investment Team views risk management and portfolio rebalancing as a blend of both qualitative and quantitative approaches. From a qualitative perspective, Azimuth looks for those managers in niche strategies who invest in less-crowded strategies while simultaneously being opportunistic with respect to the current market environment. In addition, we conduct thorough pre and post-investment due diligence on all managers in the portfolio and do not invest in those managers whose strategies we do not believe provide an adequate risk/reward balance.

Azimuth also systematically uses a variety of statistical measures including value-at-risk (VaR), expected tail loss, correlations, betas, skewness, kurtosis etc. to monitor risk levels and take action when deemed appropriate. This is done not only for individual managers (current and prospective) but also on the portfolio as a whole. In addition, the managers of the funds we invest in are required to disclose appropriate risk exposures along several dimensions which further aid the ongoing manager evaluation process.