Slim Tail

A systematic investment strategy

Mandatum Life’s Slim Tail strategies invest in the equity market based on a systematic investment process.

Past equity returns have been a good indicator of future equity market returns.

Bond returns have been a good indicator of future equity market returns.

The historical equity market returns have, for the most part, been generated at the turn of the month.

Slim Tail strategies lean strongly on academic research. Numerous studies show that past returns on the equity and fixed income markets have been good predictors of future equity market returns. Based on these studies, Slim Tail strategies closely track the actual returns of the equity and fixed income markets, with the aim of maximising investment returns as the equity market rises. Correspondingly, the strategy aims to limit risk during periods where the equity markets decline.

Slim Tail strategies also account for the so-called turn-of-the-month effect in investment operations.

Matti Suominen, Professor of Finance at Aalto University, has extensively studied the turn-of-the-month effect. According to his research, the historical equity market returns have, for the most part, been generated at the turn of the month.

 

Watch a video of Matti Suominen describing the Slim Tail strategies:

Learn more about Mandatum Life’s investment objects

Learn more about our investment objects

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