Mizuho Alternative Investments and Wilshire Funds Management are to jointly create, develop, structure and distribute risk premia investment solutions to institutional investors and financial intermediaries.
Mizuho, one of the largest financial institutions in Japan, and Wilshire, a leading global investment consulting, technology and investment management firm, bring to the table a long history of experience servicing some of the world’s largest institutional investors.
“Wilshire Funds Management offers expertise across multiple disciplines, such as customised portfolio management, risk management, infrastructure and operations. We are very excited about the opportunity to work with Wilshire and look forward to a deep and long-standing relationship in the rapidly growing field of factor based investing,” ssaysaid Masanobu Yamaguchi, President of Mizuho Alternative Investments.
“We are thrilled to work with Mizuho Alternative Investments on this initiative,” says Jason Schwarz (pictured), President of Wilshire Funds Management. “MAI’s years of experience managing quantitative investment strategies and developing innovative investment solutions for the global institutional market are invaluable to the initiative.”
Risk premia strategies are rules-based investable strategies that are designed to capture well researched market risk premia (such as carry, momentum, value, volatility, etc.) across asset classes. Through this strategic alliance, the firms will work together to analyse risk premia strategies, construct investment portfolios and customised solutions, and implement those strategies. Wilshire’s analytics and risk infrastructure enable monitoring of risk premia strategy performance and risk down to the underlying position level.
“We believe that risk premia strategies represent an important evolution in alternative investing,” Schwarz says. “Investors are increasingly seeking liquid, transparent and cost-effective alternative exposures, and we believe that the investment and risk monitoring offered by our venture with Mizuho is an integral part of the value proposition offered to investors.”
The two firms have already launched several risk premia portfolios for institutional investors, including a diversified income oriented portfolio comprised solely of strategies developed by some of the world’s largest banks and a defensive portfolio designed to seek outperformance in difficult periods for equity markets.
“Risk premia strategies have flexible and multi-faceted application in client portfolios,” Yamaguchi says. “These strategies can be used as building blocks for investors seeking to generate absolute returns, tilt portfolios toward specific conditions, increase portfolio resiliency, or smooth returns across various economic regimes. It is our hope that our risk premia solutions platform can be a useful tool in helping clients meet their specific investment needs.”
