A New Frontier in Investing Emerges

AQR Capital Management is stepping into the future with its latest innovation - Risk Parity Mutual Funds. Starting November 5, 2012, these funds are poised to diversify investors' portfolios and potentially boost risk-adjusted returns.

Balancing Act: The Essence of Risk Parity

Risk parity mutual funds take a different approach by balancing risks across asset classes instead of traditional methods that focus on assets themselves. This strategy begins with less exposure to equities and invests more in other asset classes, spreading the risk evenly.

Diversification: The Key to Unlocking Potential Returns

These new funds offer a diversified investment portfolio across globally varied assets including equities, fixed income, and commodities. This balance of risks can lead to more efficient portfolios that match individual risk profiles.

Managing Risk: The AQR Strategy in Action

The two new funds are the AQR Risk Parity II MV Fund targeting a moderate volatility level of 10%, and the AQR Risk Parity II HV Fund aiming for higher volatility at 15%. These options cater to different risk preferences, offering investors more control over their potential returns.

Building on Success: The Growth Story of AQR Capital Management

Since launching its first mutual fund in January 2009, AQR has grown its Funds business to approximately $8 billion as of September 30, 2012. This growth reflects their expertise and success in developing diversifying alternative investment strategies.

Investing Smart: The Considerations for Prospective Investors

Before diving into these new funds, it's important to consider the associated risks. AQR Funds may experience wide price fluctuations and use securities lending as a strategy to increase income or total return. This can lead to additional losses due to investment techniques.