Saturday, January 8, 2011

All Weather Fund

In simple terms an All Weather Fund is an investment product that performs relatively well throughout market and economic cycles. These funds may employ non-conventional strategies such as using both long and short positions, sector rotation, portfolio insurance, and others. They may also invest over a range of asset classes and employ tactical or dynamic asset allocation, to alter the weights to various asset classes based on valuations and economic outlook. While there's no formal category for all weather funds, all weather funds can basically be singled out based on consistent out-performance of the benchmark - through at least one market cycle.

Synonyms: Asset allocation fund, Absolute return fund, Consistency of performance

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