Commonwealth manages clients’ assets with the assumption that unexpected events will happen and markets may not always have rational price movements. With this in mind, we are constantly looking to manage risks and capitalize on opportunities.
This means that we diversify our portfolios so that they are better positioned to absorb the impact of an unexpected event before it occurs, rather than trying to react after the fact. We will often hold a significant proportion of assets in cash to be ready to pounce on an opportunity of irrational price movements or build an appropriately concentrated position in an undervalued asset to maximize return.
We will not hesitate to move up to 100% of our portfolios to cash if it is appropriate, and have structured the business model so we can do so quickly and effectively without any conflicts of interest.
Commonwealth’s Chief Investment Officer is Jason Billingsley, CFA.