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How to See Big Returns Without Big Risk

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    Axioma CEO Sebastian Ceria on how investors can still profit while minimizing their risks.

  • Duration 4:05
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Air on profit taking want to know what a leader in risk management because -- so much risk up their right.

Is telling some of the biggest American financial firms about taking on risk but in -- safer way.

Well now's your chance because Acxiom a CEO Sebastian setting -- joins us now in a Fox Business exclusive.

People are disappointed because it's very hard to find any kind of yields.

That comes out of investments they're looking at things like dividend paying stocks etc.

so they want to get a little -- -- but they want to mitigate that risk.

Or let's just use the -- let's fancy -- they want to lessen the risk.

How do you and your company do that.

Well what we do is first of all we analyse what the sources of race car right we try to figure out which other factors that are driving risk in those factors that are driving risk.

Change over time what you see now as the challenges people are having a lot of very hard time diversifying.

Their risk they're having a very hard time because everything is moving together.

So you have to look deeper and what our firm does is allows you to look deeper we call that being the -- and so you get to the factors that are really driving down.

It interesting that your software company that helps portfolio managers implement.

Sort of less risky opportunities but you've also worked with the NASDAQ to put together.

Financial instruments yet let's talk about the income the average person getting in on that.

Yeah absolutely because what what happens is passive investing news is gaining assets we if we look at what has happened in funds equity funds.

They've lost about 300 billion in assets for the last ten years.

Worse passive funds have actually gained.

400 billion so what's going on is those active managers that are out there are losing assets so what we do for now would we do with -- -- And what we do we dollars as we tried to package this sophisticated investment vehicles into the form of an index that then can be constructed into -- idea what.

Talk about some of these you know that they're sort of ETFs as you say but you've worked with the Russell by the way the NASDAQ and the Russell look just turned negative distillate you know focus we're keeping you on top of this it appears the market is.

Eroding rather quickly as we speak but.

You've worked together to partner and come up with ideas that.

Bring in low volatility.

But with a little bit of -- Yeah I mean get the whole idea is that this idea that more risk leads -- more return.

It's something that is being challenged in the market in fact these days nowhere volatility or lower risk is actually yielding better -- so that's what we went back here's.

One of them the Russell 1000 low volatility that ETF and this is obviously a about a year to date chart it's it's.

-- speaking of volatile there's a pretty dramatic spike to the right there the high the session and that.

It's come off that you also have aside from the Russell low volatility index you've got an index with gold which is pulling back today along with the price of gold.

But -- You see this -- What we see this going is we want to create transparent vehicles for people to reinvest in this investment themes.

The big banks have been investing for many many years and we -- -- make -- it's accessible so when you look at gold though when you look at oil when you look at agriculture which are the Indus is we built.

What's in those Indus is is -- But -- stocks that track the price of the commodity there while indicates of oil you will attract cold.

Saar indicates a voice we red truck oil indicates a -- -- attract goal and obviously in the case of agriculture new and attractive agricultural products and and those are not easy to track right you could do futures.

But we believe it's much better much more transparent and much more efficient.

And in the long run it actually does a much better job if you track -- -- equities.

Things have gotten so much more complicated but more choices and justify AT&T back -- the.

The -- CEO the other trend which is very important is all this ideal how do you diversify.

So has completely change right used to buy a lot of -- and that was a diversified portfolio but that doesn't happen anymore you buy a lot of stocks and all the stocks moved together.

Where did you have a diversified you haven't -- your risk well very true and we're gonna put all of his indexes on the FaceBook page FaceBook dot com slash this claiming you can check them out.

Risk is the -- -- right now Sebastian thank you thank you very much news any time is about setting out of axial my and that is.

An Argentinian accent in case you're wondering I with -- -- system.

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