Tuttle Capital Management
FAT TAIL RISK ETF
The Fat Tail Risk ETF (FATT) is designed to offer positive carry tail risk. Typically, when investors look at tail risk protection they have a few options:
- Do nothing and hope nothing bad happens.
- Buy something that will have a constant drag on returns in the hopes that it will pop when we have a tail event.
- Try to time tail-risk protection.
- Bonds (which may offer some protection, if any).
FATT is designed to replace these options. You can set it in a portfolio and forget it. During a bull market, it aims to generate some returns, but its primary objective is to be there for you during a tail-risk event, the occurrence of which may be more frequent than one might expect.
Those who have taken statistics will no doubt be familiar with the bell curve. If one is looking at stock market returns, ideally they would be grouped around a median with narrow tails on each side. In real life, the tails are much fatter, especially on the left-hand side (negative returns) as the magnitude of losses and number of occurrences tends to be much larger than statistics would estimate.
These fat tail events (which encompass financial risk of an asset or portfolio of assets moving more than three standard deviations from its current price) can be devastating to portfolios. For example, in 2008 the S&P 500 had a drawdown of around 60%. Similar “100-year-storms” have occurred 5 times in the past 12 years alone.
About the Advisor
Matthew Tuttle is the Chief Executive Officer and Chief Investment Officer of Tuttle Capital Management, LLC (TCM). Matthew is a familiar face among the financial media. He has been a frequent guest on CNBC and Fox Business and has been widely quoted in the Wall Street Journal and Barron’s. He is the author of How Harvard & Yale Beat the Market and Financial Secrets of my Wealthy Grandparents.
Matthew has an MBA in finance from Boston University.
Portfolio Offers Investors a Way to Protect Against Market Declines NEW YORK, May 25, 2021 /PRNewswire/ — Fat Tail Risk ETF (NYSE: FATT) will start trading on the New York Stock Exchange today. FATT offers investors a way to protect portfolios against large market...
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