The graph to the right shows the impact that large losses have on a portfolio and the required return needed to breakeven. If your investments lose 30%, it takes a 43% gain to breakeven. If you lose 50%, it takes a 100% gain to breakeven. We call this the Fundamental Law of Percentages.
Economic Environments
Perissos uses a Tactical Allocation approach to assess the current economic environment and the direction in which we believe the economic environment is heading.
Our analysis indicates that there are four primary economic environments. As the economy shifts between these economic environments, a portfolio must be adjusted dynamically to manage investment risk and take advantage of opportunities that may arise
Fundamental Analysis
Fundamental Analysis of economic environments helps identify WHAT assets to invest in.
Strategic Analysis
Strategic Analysis of assets and their correlation to one another changes as the economic environment changes and tells us HOW MUCH of an asset to purchase.
Tactical Allocation Decisions
The analysis of each asset’s trend helps us identify when to buy an asset and, more importantly, WHEN TO SELL.
