Click the sections below to explore THOR’s Investment Process.
Measure Market Risk
We have proprietary risk measures for investing in equities and fixed income.
High Risk = Underweight equity and/or fixed income exposure & increase alternative investments (low beta).
Low Risk: = Overweight equity and/or fixed income exposure & minimal to no alternative investments (high beta).
We are a long-term, tactical investment manager (meaning we will adjust your portfolio allocation over time). When our measures signal that risk is high in the equity and fixed income markets, we will reduce exposure in those areas. And when our measures signal low risk in the equity and fixed income markets, we will increase exposure.
Here is a link to a white paper we did on the THORdex, which is our equity risk measure.
Individual Security Analysis
We have no preference between investment vehicles (ETFs, mutual funds, individual securities, etc.). In each sub-asset class of your portfolio, we analyze the best way to be invested, which includes asset location for tax purposes and fees.
Different securities require different types of due diligence, but each security goes through a disciplined, in-depth analysis and approval process.
Define Personal Risk Profile
Risk Tolerance = Ability to take risk + Willingness to take risk.
Understanding your personal risk tolerance and long-term financial goals is our first step to determining appropriate allocations for your portfolio. Based on this analysis, we will establish an allocation target and ranges within security classes (equity, fixed income/cash, and alternative investments) to manage your portfolio.
Reversion to the Mean Models
Overweight and Underweight individual sub-asset classes within our equity and fixed income portions of the portfolio.
All equity and fixed income sub-asset classes have a similar return profile over the long-term, but each have dramatic periods of under/out performance. We want to take advantage of this by overweighting sub-asset classes that are lagging, understanding that they will catch up.
Your Optimal Investment Portfolio
The makeup of your portfolio is a combination of the following four continuous steps. This is a collaborative process between you, your relationship manager who will understand your situation, and the investment committee to construct the optimal investment portfolio.