One of the primary benefits of Tactical Asset Allocation (TAA) is the ability to manage losses during major market declines. TAA does that by reducing allocation to risk asset classes like stocks and real estate, and increasing allocation to defensive assets like bonds and gold. In this post, we test how the 60+ TAA strategies […]
Falling Markets
What to Expect from TAA When Markets Fall
Markets have started the month weak. We got spoiled last year. After such an abnormally long period of market calm, it’s natural for investors to feel a little anxious. We have no opinion on where the markets go from here. That’s why we’re quantitative traders. We put a lot of time into understanding these models so […]
Why TAA Has Been So Successful in Crises
Most Tactical Asset Allocation (TAA) strategies have followed the same basic storyline. They keep pace with the market during the good times (like we find ourselves in right now), and shine during the bad times. To illustrate, the graphs below shows the average return of all of the TAA models that we track (orange) versus the […]