What are Volatility Risk Premium Strategies?

May 17, 2018 | Joe McGuane, CFA, Senior Research Analyst, Alternatives

Volatility Risk Premium (“VRP”) strategies — also known as defensive equity strategies — are relatively new to the institutional landscape, but have grown in popularity given the current backdrop of historically high equity valuations, low interest rates, and frustration over hedge fund fees and performance. This newsletter summarizes how these strategies operate and outlines key risk and return metrics that will help investors decide if a VRP strategy is appropriate for their portfolios.

Download PDF

 

The opinions expressed herein are those of Marquette Associates, Inc. (“Marquette”), and are subject to change without notice. This material is not financial advice or an offer to purchase or sell any product. Marquette reserves the right to modify its current investment strategies and techniques based on changing market dynamics or client needs.

Joe McGuane, CFA
Senior Research Analyst, Alternatives

Get to Know Joe

Related Content

01.18.2019

2019 Market Preview

Coming off a difficult 2018, investors face a litany of questions going into this year, whose potential answers will undoubtedly…

12.28.2018

2019 Market Preview Briefing

Live Webinar – Thursday, January 17, 2019 – 1:00-2:00 PM CT

12.21.2018

Keeping the Current Market Correction in Perspective

Over the last few months, equity markets have experienced sizable drops, making many investors wary about the future. Despite this,…

12.21.2018

Fourth Rate Hike of 2018; More to Come?

On Wednesday, December 19, the Federal Reserve executed its fourth rate hike of 2018. This 25-basis point hike, the ninth…

12.21.2018

What Happened to International Small-Cap Equities This Year?

This year’s non-U.S. equity returns have been disappointing, particularly for developed small-cap, with the MSCI EAFE small-cap index down 17.6%…

12.19.2018

Target Date Funds: Preparing Participants for Retirement

A pitfall for a majority of plan participants surrounding retirement planning is a lack of familiarity with…

More articles

Subscribe to Research Email Alerts

Research Email Alert Subscription

Research alerts keep you updated on our latest research publications. Simply enter your contact information, choose the research alerts you would like to receive and click Subscribe. Alerts will be sent as research is published.

We respect your privacy. We will never share or sell your information.

Thank You

We appreciate your interest in Marquette Associates.

If you have questions or need further information, please contact us directly and we will respond to your inquiry within 24 hours.

Contact Us >