Global Balanced Risk Control Strategy: Total Portfolio Risk Control
Global Balanced Risk Control Strategy: Total Portfolio Risk Control

Global Balanced Risk Control Strategy: Total Portfolio Risk Control


The Global Balanced Risk Control (GBaR): Total Portfolio Risk Control Strategy applies an integrated approach to global balanced investing within a risk-controlled framework. The Strategy aims to manage total portfolio risk as defined by value-at-risk (VaR) or volatility metrics, while simultaneously seeking to enhance returns from tactical insights into global markets. Portfolios within the Strategy seek to achieve a target risk for the total portfolio, while still benefitting from any alpha generated from tactical asset class views. The team uses its top-down research process, involving fundamental and quantitative analysis across asset classes, to determine active positions.

Strategy Inception
Total Portfolio Risk Target
Base Currency
Investment Approach

The team believes that their top-down macro investing approach combined with explicit, quantitatively driven risk control delivers excess returns, as well as reducing downside risk in volatile markets. They believe that given the flexibility of the Strategy, it can act as a standalone investment as well as a risk control ‘buffer’ within a larger portfolio which is aiming to manage total portfolio risk. 

Designed to Perform in All Market Conditions

The team seeks to provide a measure of downside protection in volatile markets and upside participation in growth markets. 

Unique Approach

Rigorous quantitative risk analysis is combined with the team’s own macroeconomic views to create a unique and dynamic approach to balanced investing. 

Attractive Risk-Return Target

The team invests across a wide investment universe, focused on providing diversified, risk-controlled exposure to a broad range of global asset classes. 

Investment Process
Risk Profile

All GBaR mandates are customisable to help meet client objectives regarding targeted risk, investment restrictions, and other requirements. Once the portfolio’s volatility target has been determined, the team dynamically manages a broad asset mix to help meet that target.

Tactical Positioning

Employing its top-down research process combining fundamental and quantitative analysis, the team develops tactical insights, which in turn are used to determine preferences within each asset class. 

Quantitative Implementation

The team’s quantitative implementation takes advantage of the tactical insights in a risk-controlled framework. The team translates tactical positions into expected returns, using quantitative techniques to construct the portfolio. Its disciplined risk management ensures that the expected total portfolio risk is consistent with the agreed risk constraints. 

Portfolio Managers
Managing Director
37 years industry experience
Executive Director
11 years industry experience
Market Outlook
2018: Expect the Unexpected
Dec 31, 2017
Three possible surprises for investors are on our radar for 2018: a monetary policy surprise; an inflation surprise; and a volatility surprise.
Market Outlook
The Third Arrow: Governance
Nov 30, 2017
Behind the scenes, Japan’s corporate governance reform has been hitting the mark, leading to higher Return on Equity. Europe’s governance scores have also improved, while the U.S. shows some notable exceptions.
Market Outlook
Calm Before the Storm
Oct 23, 2017
A number of storm fronts are forming off the coast of what is otherwise a sunny economic environment, from rising rates to debt and politics. Investors need to have a plan for taking shelter.


There is no assurance that the Strategy will achieve its investment objective. Portfolios are subject to market risk, which is the possibility that the market values of securities owned by the portfolio will decline and that the value of portfolio shares may therefore be less than what you paid for them. Accordingly, you can lose money investing in this portfolio. Please be aware that this strategy may be subject to certain additional risks. There is the risk that the Adviser’s asset allocation methodology and assumptions regarding the Underlying Portfolios may be incorrect in light of actual market conditions and the Portfolio may not achieve its investment objective. Share prices also tend to be volatile and there is a significant possibility of loss. The portfolio’s investments in commodity-linked notes involve substantial risks, including risk of loss of a significant portion of their principal value. In addition to commodity risk, they may be subject to additional special risks, such as risk of loss of interest and principal, lack of secondary market and risk of greater volatility, that do not affect traditional equity and debt securities. Currency fluctuations could erase investment gains or add to investment losses. Fixed-income securities are subject to the ability of an issuer to make timely principal and interest payments (credit risk), changes in interest rates (interest-rate risk), the creditworthiness of the issuer and general market liquidity (market risk). In a rising interest-rate environment, bond prices may fall. Equity and foreign securities are generally more volatile than fixed income securities and are subject to currency, political, economic and market risks. Equity values fluctuate in response to activities specific to a company. Stocks of small-capitalization companies carry special risks, such as limited product lines, markets and financial resources, and greater market volatility than securities of larger, more established companies. The risks of investing in emerging market countries are greater than risks associated with investments in foreign developed markets.  Exchange traded funds (ETFs) shares have many of the same risks as direct investments in common stocks or bonds and their market value will fluctuate as the value of the underlying index does. By investing in exchange traded funds ETFs and other Investment Funds, the portfolio absorbs both its own expenses and those of the ETFs and Investment Funds it invests in. Supply and demand for ETFs and Investment Funds may not be correlated to that of the underlying securities. Derivative instruments can be illiquid, may disproportionately increase losses and may have a potentially large negative impact on the portfolio’s performance.  A currency forward is a hedging tool that does not involve any upfront payment. The use of leverage may increase volatility in the Portfolio. Diversification does not protect you against a loss in a particular market; however, it allows you to spread that risk across various asset classes. 

This communication is only intended for and will be only distributed to persons resident in jurisdictions where such distribution or availability would not be contrary to local laws or regulations.

There is no guarantee that any investment strategy will work under all market conditions, and each investor should evaluate their ability to invest for the long-term, especially during periods of downturn in the market. Past performance is no guarantee of future results.

A separately managed account may not be suitable for all investors. Separate accounts managed according to the Strategy include a number of securities and will not necessarily track the performance of any index. Please consider the investment objectives, risks and fees of the Strategy carefully before investing. A minimum asset level is required. For important information about the investment manager, please refer to Form ADV Part 2.

Any views and opinions provided are those of the portfolio management team and are subject to change at any time due to market or economic conditions and may not necessarily come to pass. Furthermore, the views will not be updated or otherwise revised to reflect information that subsequently becomes available or circumstances existing, or changes occurring. The views expressed do not reflect the opinions of all portfolio managers at Morgan Stanley Investment Management (MSIM) or the views of the firm as a whole, and may not be reflected in all the strategies and products that the Firm offers.

All information provided has been prepared solely for information purposes and does not constitute an offer or a recommendation to buy or sell any particular security or to adopt any specific investment strategy. The information herein has not been based on a consideration of any individual investor circumstances and is not investment advice, nor should it be construed in any way as tax, accounting, legal or regulatory advice. To that end, investors should seek independent legal and financial advice, including advice as to tax consequences, before making any investment decision.


Alpha is the excess return or value added (positive or negative) of the portfolio’s return relative to the return of the benchmark.

Value at Risk (VaR) is a statistical technique used to measure and quantify the level of financial risk within an investment portfolio over a specific time frame.

Volatility is a statistical measure of the dispersion of returns for a given security or market index.


The indexes are unmanaged and do not include any expenses, fees or sales charges. It is not possible to invest directly in an index. Any index referred to herein is the intellectual property (including registered trademarks) of the applicable licensor. Any product based on an index is in no way sponsored, endorsed, sold or promoted by the applicable licensor and it shall not have any liability with respect thereto.

The information presented represents how the portfolio management team generally implements its investment process under normal market conditions.

1422937 Exp. 02/28/2017


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