The ROBOT philosophies of strategy architecture, risk management strategies and portfolio integration are synergistic. We believe first and foremost that any great methodology should excel not only on its own but also offer quantifiable benefit to each other via an expertly constructed portfolio. Each of the ROBOT strategies has been designed from the ground up with the thought of such integration in mind.
Many quantitative trading firms simply curve fit a single strategy to a narrow range of recent market conditions using parameter optimization. While this method can produce impressive short term returns, the very nature of the auction process in all markets has proven again and again its propensity to eventually identify and eliminate any such inefficiencies.
Instead of fragile and often fleeting inefficiencies, ROBOT has chosen to construct its portfolio around a solid foundation of relatively simple investment strategies universally accepted for centuries by clients and advisors alike. Where many absolute return programs end and ROBOT begins is in our commitment to integration. Our strategies were not only designed to integrate with each other into a complete absolute return solution, but that solution is flexible enough to be custom integrated into the overall portfolio as well.
Above all, risk management strategies are our primary focus. Simply stated, we expend far more effort learning to minimize losing periods then we do on maximizing winning ones. In our view, high returns are only impressive if they are markedly consistent across the time horizon for investment and if coupled with equally impressive drawdown mitigation during the inevitable difficult periods encountered by any strategy.