Investors and fund managers are always on their toes, trying to anticipate when and where risk will appear next. The biggest source of market risk comes from major black swan events — unpredictable events or phenomena that drag markets lower.
Universa Investments COO Brandon Yarckin discusses how his firm mitigates risk for clients, including in private equity (PE) categories and pension holdings.
“Now that we have this context of portfolios that are built a certain way, we look at the financial landscape as being incredibly leveraged. There’s a tremendous amount of debt,” Yarckin tells Yahoo Finance, adding: “And we’ve seen the Federal Reserve raise interest rates as quickly as they ever have. So that has specific lag effects, and one of the most visible lag effects that we’ve seen is on private equity.”
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Editor’s note: This article was written by Luke Carberry Mogan.