Safron’s primary investment process utilizes the top-down approach, beginning with monitoring of global trends and macroeconomic developments. This forms the basis for long-term positioning and allocation of assets to derive consistent and stable returns.
Upon the identification of the key investment ideas, the investment team proceeds to analyze the suitability of each asset class to derive maximum trade efficiency. The trade ideas could be implemented via equity or forex asset classes, in addition with derivatives or structured products to reap better risk-reward returns.
If the investment idea leads to the execution of an equity trade, the team continues to delve deeper into the specific industry to identify the key players in the market. This is to distinguish the market leaders and laggards in the industry in order to find the best stock in executing the trade idea. We pay cautious attention to risk-reward payoffs and may not carry out the trade if the market has priced off the idea.
With the recent involvement of central banks, it became more imminent to be mindful of major driving forces in the markets that could trigger multi fold impacts to various asset classes. As such, we pay much attention to the different asset classes’ movements to identify correlated trends and inter-class relationships. We only invest when the inter-asset classes move in a coherent direction with supportive relationships. We avoid getting into the markets when price movements move erratically across multiple assets.
Regardless of trade execution, we remained vigilant in keeping track of the markets and holdings to ensure that the investments stick to the initial investment plan. We review and adjust the portfolios strategy and positions regularly to mitigate any underlying changes to either our investment theme or adverse price movements. We see risks first before recognizing potential profits so as to stay profitable in the long run.
EconomicsGlobal trends and developmentsInteractions between multiple
ExecutionIdentification of market leaders and laggardsAnalyse risk-reward on trade entryConclude trade execution
GenerationKey trade ideas from macro observationsIdentification of asset class for maximum
ReviewTrade review & adjustmentsPortfolio strategy review