Structured Approach To Investment Decisions
Conventional benchmark-based strategies rely on diversification as the primary risk-mitigation tool. While effective at smoothing volatility during stable market conditions, they fail to prevent severe drawdowns during periods of crisis—precisely when protection matters most.
SATID is a disciplined methodology that, while grounded in benchmark portfolios, adds a high degree of unconditional portfolio protection. Its objective is to prevent the losses that diversification alone cannot avoid.
The SATID methodology operates across three core components:
For each investment, SATID calculates a dynamic risk threshold using an optimized, transparent algorithm updated weekly. These thresholds can be customized to align with specific portfolio risk requirements.
These thresholds are aggregated at the portfolio level to determine portfolio risk boundaries. These boundaries define the maximum loss tolerated. When they are approached or reached, it signals that diversification is likely failing, and the SATID methodology activates to protect capital.
A portfolio dashboard continuously summarizes the maximum portfolio loss tolerance. It indicates the maximum capital at risk under adverse market conditions, along with a risk score that reflects the probability of these levels being reached over the coming week and month.
Clients do not need to over-allocate to conservative assets to limit capital loss. Instead, they can confidently pursue long-term capital appreciation strategies and select their risk profile based on clearly defined, pre-determined capital at risk—rather than relying solely on historical risk-return assumptions.
Clients can invest with confidence, knowing that unconditional capital protection is in place—regardless of asset allocation or market severity.
SATID uses benchmarks as an initial guide, enjoying the benefits of diversification and unlimited capital growth. However, it will systematically deviate from it as soon as its trajectory fails to meet the client's mandate. In downturns, SATID replaces benchmark-centric management with a dynamic, rules-driven risk discipline that prioritizes downside protection without compromising long-term growth potential.
| Conventional Approach | SATID Overlay |
|---|---|
| Managed against a benchmark. | Managed against client's mandate. |
| Potential losses are an unknown variable. | Potential losses are determined and managed. |
| Accepts unlimited downside risk. | Strictly limits downside risk. |
| Relies on static, historical risk models. | Employs dynamic, forward-looking risk models. |
| The risk of diversification failure is not quantified. | Proprietary Risk Score warns risk. |
| Emotions can influence critical decisions. | Clear rules prevent emotional mistakes. |
| Suited for institutional Capital. | Purpose-built for Private Clients. |