The Swan Defined Risk Strategy

A unique, time-tested investment approach, the Defined Risk Strategy has been helping investors grow and protect wealth since 1997.

The Defined Risk Strategy has been applied to various asset classes and available in a range of investments vehicles.

ACHIEVE DESIRED OUTCOMES WITH A TIME-TESTED APPROACH

We developed our Defined Risk Strategy (DRS) in 1997 as a way to offer our clients a distinctive, innovative tool for minimizing market risk. The DRS is designed to provide stable returns over a full market cycle, while hedge against large stock market declines. We pursue this goal through a rules-based, actively managed hedged equity investment process.

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MAXIMIZE WEALTH BY MINIMIZING LOSSES

The market is unpredictable, making it difficult to time the markets or consistently pick outperforming stocks. That’s why we believe that the key to wealth creation is to remain invested while reducing downside risk.

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A SOLUTION TO THE CHALLENGES INVESTORS FACE TODAY AND BEYOND

The Defined Risk Strategy solves many of the most pressing challenges that investors and advisors struggle to solve:

  • Seeking investment return in a low yield world
  • Minimizing volatility
  • Timing and sequence of returns challenge
  • Retirement income challenge
  • Bear market protection
  • Tax efficiency

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THE DEFINED RISK STRATEGY INVESTMENT PROCESS:

  • Always invested to participate in market appreciation over time
  • Holding index-based ETFs
  • Always hedging investments with puts
  • Generate market-neutral income through the use of options
  • Following a rules-based process to eliminate the impact of emotions on investment decisions.

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A TRACK RECORD OF SUCCESS

Our consistent approach offers investors a better way to grow and protect wealth.

The Defined Risk Strategy is designed to outperform the underlying benchmark over a full market cycle (bull and a bear market). Since inception in 1997, the DRS has done just that.

The S&P 500 has had four down years since 2000, for a total cumulative combined loss of more than 80%. During those years the Swan DRS provided a cumulative combined return of +18%*. This performance during downturns is one reason the Swan DRS has consistently outperformed the S&P 500 over full market cycles.

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Swan Defined Risk Investing

The strategy’s success prompted us to apply it across multiple products and assets, providing our clients with additional opportunities to use this time-tested approach.

Swan
DRS SMA

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DRS FUNDS

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DRS CIT

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Swan
DRS OVERLAY

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RE

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*Source: Swan Global Investments and Morningstar; the S&P 500 index in an unmanaged index, and cannot be invested into directly. Past performance is no guarantee of future results. The performance numbers referenced above are used for illustrative purposes to indicate the DRS’s performance during Bear Market conditions.