Absolute-Return-Oriented Strategies

Lowenstein, Alice
March 2011
Journal of Financial Planning;Mar2011, Vol. 24 Issue 3, p42
Academic Journal
The article reports on the absolute-return-oriented (ARO) strategies which are designed to generate consistent, middle-single-digit returns for market environment in the U.S. with relatively low correlation to traditional asset classes and risk factors. It outlines key research questions and challenges that would cover as part of a decision to apply ARO strategies. It states that it increases the relative attractiveness of absolute-return strategies if traditional asset classes are performed below their longer-term averages, and at a level that does not fully compensate for their potential risks. It notes that it is more difficult to attain the high level of confidence needed to make any investment if an actual track record is not available.


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