The Rydex Alternative Strategies Allocation Fund aims to deliver returns with low correlation to traditional stock and bond asset classes, as well as provide capital appreciation.
The fund invests in a suite of alternative mutual funds and exchange-traded funds to provide exposure to these alternative asset classes and investment strategies including real estate, commodities, managed futures, absolute returns and currency arbitrage.
Rydex relies on a rules-based investment methodology to analyze the historical correlations and risks of the underlying funds, as well as current market conditions, said Edward Egilinsky, managing director of alternative investments for Rydex. From a portfolio diversification standpoint, alternatives have collectively shown a very low or negative historical correlation to stocks and bonds.
