By combining dynamic risk control and scientifically based methodology, the fund provides a flexible investment strategy tailored to today's rapidly changing markets. This makes the OLZ Equity World Dynamic 0-100 Fund a suitable tool for risk-aware investors to navigate through the storms of financial markets and reduce the risk of losses.
Since financial markets are characterized by uncertainty and fluctuations, investors face the challenge of finding an attractive balance between risk and return. Here, the OLZ Equity World Dynamic 0-100 Fund comes into play, an innovative investment solution that aims to harness the long-term equity risk premium while ensuring better capital protection.
Since its launch in December 2023, the proprietary OLZ trend and risk signals have been able to successfully identify strong bull markets, which is why the fund has been invested 100% in liquid and cost-effective passive ETFs on the MSCI World Index since its launch. From December 20, 2023, to April 16, 2024, the fund has therefore shown a performance of 12.6%, clearly outperforming benchmarks such as the 60% MSCI World Index & 40% SARON (performance of 6.9%) and the Pictet BVG-40 Index (performance of 3.9%).
Access to Long-term Equity Risk Premium with Simultaneous Reduction of Drawdowns
Historically, equities have provided the highest returns among liquid asset classes over the long term. To benefit from the so-called equity risk premium, however, investors must be willing to take certain risks. The OLZ Equity World Dynamic 0-100 Fund was developed to provide investors access while controlling risk, with bandwidth control within the asset allocation tailored to individual risk profiles. Thus, it can be used both as a standalone product and as an alternative or supplement to static mixed portfolios with a higher equity quota at lower risk of loss.
A Dynamic Response to Market Risks
The risks in the stock markets behave dynamically. Seemingly stable upward phases can be abruptly replaced by severe price slides. A rigid equity quota can therefore mean excessively high or too low risks at times. The OLZ Equity World Dynamic 0-100 addresses this problem through risk-based dynamic control of the equity quota, which is adjusted according to current market conditions. This approach aims to reduce loss potential by reducing the equity quota in stormy times.
Scientifically Based Risk Control
The dynamic control of the equity quota in the OLZ Equity World Dynamic 0-100 is based on empirical evidence and the latest scientific methods. In a first step, various medium- to long-term technical trend signals are considered and aggregated to derive a robust base allocation. This serves as a guideline for the basic orientation of the fund. In addition, by monitoring a number of additional market risk indicators, a daily proprietary risk signal is generated that allows for quick response to changing market risks.
Daily Monitoring and Efficient Implementation
With the OLZ Equity World Dynamic 0-100, investors can conveniently benefit from the dynamic risk control of OLZ. The strategy utilizes the investment universe of the MSCI World Index and relies on cost-efficient implementation with liquid ETFs, futures, and money market funds. The equity quota is determined daily and can vary between 0 and 100% depending on the market environment, with a reduction in the equity component exclusively in favor of Swiss money market investments.
Risk-Return-Characteristics
To visualize the benefits of the OLZ Equity World Dynamic 0-100 solution, we have depicted in Figure 1 the performance development and in Figure 2 the two largest historical drawdowns, and in Table 1 the key return and risk metrics of the model and the benchmarks over the last 20 years. All results are in CHF.
