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Style
drift happens when an active manager drifts from a specific
style, asset
class, or index that is described as the investment purpose
of a portfolio or mutual fund. For example, a manager may
drift from small cap value to small cap growth. This is a
substantial problem if you have carefully determined your
Risk Capacity™ and matched it to a Risk Exposure.
Program Overview
Investment professionals and academics
use many terms to define risk. These include markets, benchmarks,
asset classes, styles, style boxes, investment objectives,
risk factors, market dimensions, market segments, buckets
of stocks, rules of ownership, slices of the market, industry
classifications, and indexes such as Dow Jones Indexes,
Standard and Poor's Indexes, Russell Indexes, Wilshire
Indexes, Morgan Stanley Capital Indexes, Wired Index, and
many more.
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