CB Total
On November 1, 2008, we initiated CB Total (CBT) which is a simulated portfolio of funds and fixed income instruments. We want investors to consider CBT a corner stone in a total portfolio. The objective is for CBT to have a very low correlation to the equity market and to generate an annual return significantly above that of bonds.
Investment universe
CBT invests only in funds (4-8 funds), bonds or cash. Maximum 20% of the capital may be invested in long-only funds, that is, funds with a high correlation to the equity market.
Objectives
CBT is meant to generate an annual return of ca 8-12% (net of fees) at low risk and with negative or low correlation (max 0.2) to the equity market (that is, the return is meant to be independent of the market development).
Risk level
Risk is usually measured by standard deviation. Historically the equity market risk has shown an annual standard deviation of ca 15-20%. The targeted annual standard deviation for CBT is ca 6-8%.
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