The Certeza Strategy

We created the Certeza Strategy because investors told us the returns of equities have not lived up to the promises made.

For investors seeking equity exposure with reduced risk we believe we offer a better solution than traditional “hedged equity” strategies.

We apply a highly sophisticated understanding of mathematics and statistics to give investors strong participation when the S&P 500 is rising, while seeking protection against large losses.

By exploiting the increasingly dramatic market inefficiencies experienced during times of market panic, we aim to generate additional alpha while others are simply focused on limiting losses.

We seek to achieve all of this through the fully systematized trading of derivatives.

How are we able to do this differently than others? The key is a deeper understanding of the fundamental forces that act on the markets.

Markets are like mountains
Mountains often appear to be ever changing; snow cover, glaciers and crevasses, slides, vegetation, and weather can all make the mountain seem different.

In reality, the core mountain and the optimal routes to its summit are generally unchanging.
What actually changes is the atmosphere and topography:
Sometimes calm and stable
Other times volatile and seemingly chaotic

Inability or unwillingness to consider or act on this important distinction will at best lead to an inefficient expedition and at worst catastrophic failure.

 

For investors this means lower than achievable risk-adjusted returns. To us, this is unacceptable.

We see the mountain more completely than others

Our research methods and proclivity for abstract reason enables visualization of data and their relationships in such a way that we can design systems to build upon core structures and exploit market topography.

Visualizing data and their relationships in order to understand their fundamental behavior over time, and across all conditions, is absolutely key to what we do.

Greater sophistication – better for mountaineers and investors

With the right understanding it is possible to have the best of both worlds:

  • Participation in the upside when times are good
  • Limited downside in bad times with opportunities for additional returns when others panic
Stability
Expert mountain guides
Experienced guides appreciate the fundamental unchanging mass of the mountain and the reliability of the route.
Our strategy
Mathematics provide the unchanging structure and describe the route.
Managing in changing conditions
Expert mountain guides
Guides are able to make the necessary adaptations to changing conditions so that they can maintain pace in good conditions and prevent catastrophe in bad.
Our strategy
The model navigates changing conditions in real time and continuously positions our investors to keep up with the market when it rises and avoid large drawdowns when it falls.
Special opportunities
Expert mountain guides
True experts may even know when certain changes in conditions could result in the opening up of little-known short cuts that may otherwise suggest peril to the less sophisticated.
Our strategy
Our acute understanding of volatility presents special opportunities when others are focused solely on limiting their losses.
Contact us for more information
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