A cornerstone of our risk philosophy
Risk management is not merely a safeguard; it stands as a cornerstone of our investment philosophy and an integral part of our culture. Recognizing that risk is inherent in the pursuit of opportunity, we approach it with a disciplined and systematic framework designed to protect and grow our clients’ capital—aligned with our own—through a shared commitment to success.
Opportunistic investing
News-Driven Strategies in Market Cycles
Situational Awareness: Navigating Markets with a Traffic Light System
We adopt an opportunistic approach, investing only when the reward-to-risk ratio is compelling, and remain disciplined in cash during less favorable conditions while actively scanning for new opportunities.
The success of a news-driven investment strategy is significantly influenced by broader market conditions. In bullish markets, where optimism prevails, it is often easier to hold positions for longer durations, allowing momentum to build. Conversely, in bearish environments, even promising news-driven runs may lose steam quickly due to prevailing downward pressure, prompting us to lock in profits sooner.
We use a Situational Awareness framework, adapted from aviation, featuring a traffic light system to guide decisions: Green for favorable markets supporting longer holds, Yellow for mixed conditions requiring caution, and Red for unfavorable markets needing quick profit-taking or staying in cash. Our SA insights rely on key indicators like moving averages, market breadth, and advance-decline ratios, emphasizing alignment with market forces.
​This dynamic understanding of the market environment allows us to tailor risk and exposure levels to prevailing conditions, enhancing the probability of success while effectively managing potential downsides. Progressive exposure lies at the heart of our strategy, enabling us to scale into positions thoughtfully as opportunities unfold.
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Diversification across themes and sectors further strengthens our approach, mitigating concentration risk and enhancing portfolio resilience. Additionally, rigorous stop-loss mechanisms are integral to our process, allowing us to act decisively when markets move against expectations, thereby minimizing potential losses.
We employ index futures for hedging, aiming to mitigate risks that may occur beyond the standard trading hours of U.S. stock exchanges.
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At Delbert Capital Management, our steadfast commitment to risk management is not just about preservation—it is about empowering long-term success. By embedding these principles into every facet of our investment process, we aim to deliver consistent, reliable returns while navigating the ever-evolving challenges of global financial markets.
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