Qube is another place I like. They I believe have averaged closer to 30% returns per year, although a much shorter history. 2018-current. And annualized vol is around 12-16%. With little to no correlation to the market at essentially .2 beta. These are just some places I like personally. bc I have target vol and beta in mind for this.
Statar is another great one, nat gas at around 20% per year. Again, completely independent of the market.
These are more for non-correlated returns, orthogonal bets that can move and provide independent returns from the market that typically you can't reproduce yourself. So these buckets for investments have different goals then you're trading goals as true diversifiers. Where as having something that is correlated just ends up being the same bet you are already making in your trades for example.
Also adding bets that have good convexity in stress events, but for the most part do nothing most the year helps although that is very small. A lot of really creative structures in terms of protecting yourself but still allowing yourself to play the game aggressively when you want. and then obviously there are a lot of tax strats you can implement. Like AQR strategies, PPLI to minimize your tax hits. The tax stuff I'll go into soon.
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Millennium is such an incredible fund. I know people will say, well it slightly underperforms the SPX in the average year as its at 12.5% annual post fees. It does, but the underlying numbers are whats important. They were created in 1989, and have had ONE negative year and that year was around -3%. While that year the index dropped 38%. The annualized vol of the index is around 15% while they are around 3%. So you are only giving up 2% returns for 75% less vol and have part of your portfolio that is smoothing the path of returns. For that part of the port that is less about risk taking. You don't have bad years, just consistent years in general. Which is great for the wealth preservation side. The risk management is incredible, this is a place that essentially fires teams for having 5% drawdown. There are so many ways to build different parts of your portfolio to get to the overall target volatility that you want.
Pentosh1 ↗