Black Monday Oct 19 1987: stock markets crashed around the world. The front page of The New York Times captured the drama.
The Dow dropped by 508 points that day, to 1738.74 (- 22.6 %). This was in sharp contrast to the hefty 44 % gain the previous seven months. Trading without a hedge or general rules to shield you from such rapid falls is hazardous, and will wipe out any leveraged long portfolio in less than a day.
The management of Venninvest AS has developed a risk-control framework allowing us to access a globally accepted equity-indices while limiting the exposure with a set of hedging- and trading rules. The risk control features
- a globally accepted, independent indices like the FTSE100
- transparent methodology based on the index's historical volatility (indexology) over the last 30 years
- ability to control risk, measured by volatility, to a predefined level
- hedging by contract options
- set of general trading rules that base investments strictly on statistical probabilities to remove human behavior biases