Designed to yield attractive risk-adjusted returns while diversifying investors’ exposure to equity risk, the funds will be distributed through financial advisors only.
AQR cfa, co-founding partner and head of client strategies David Kabiller said, "These funds can help advisors better target their particular risk preference: higher risk and higher potential returns or moderate risk and more moderate returns."
According to the asset manager, risk parity funds seek to produce attractive risk-adjusted returns by investing in a globally diversified portfolio of equities, fixed income and commodities.
As per the varied risk preference of different investors, the MV fund targets a moderate 10% annualized level of volatility, while the HV Fund aims for a higher target annualized level of volatility of 15%.
Established in 1998, AQR Capital Management manages nearly $63.9bn as of 30 September 2012, for institutional investors, including pensions, insurance companies, endowments, foundations and sovereign wealth funds, as well as registered investment advisors.
