Active share: Active share is defined as the percentage of the portfolio that differs from its passive benchmark. For a long-only portfolio, the active share measure is between 0% and 100%. An active share measure of 0% indicates the portfolio is identical to its benchmark while a 100% active share measure indicates the portfolio has no overlap with its benchmark. (Source: William Blair) Only the benchmark-differentiating holdings can generate relative outperformance. (Source: MFS)
Asymmetric Returns: the greater degree to which an investor participates in gains when the market rises relative to the extent the investor participates in losses when the market falls. Can be measured by comparing an investment’s up-capture to down-capture. For example, an investment with a up-capture relative to the S&P of 68% and a down-cap of the relative to the S&P of 34% would have an asymmetry ratio of 2 and be considered highly asymmetrical.
Beta: A statistic that measures the volatility of the fund, as compared to that of the overall market. The market’s beta is set at 1.00; a beta higher than 1.00 is considered to be more volatile than the market, while a beta lower than 1.00 is considered to be less volatile. Sharpe ratio: A statistical measure that uses standard deviation and excess return to determine reward per unit of risk. A higher Sharpe ratio implies a better historical risk-adjusted performance.
Beta and Sharpe ratios are compared vs. Standard & Poor’s 500 (S&P 500) as index. S&P 500 is an index of 500 stocks chosen for market size, liquidity and industry grouping, among other factors. The S&P 500 is designed to be a leading indicator of U.S. equities and is meant to reflect the risk/return characteristics of the large cap universe.” One cannot invest in an index.
Correlation: A statistical technique that can show whether and how strongly pairs of variables are related. Correlation is positive when values increase (or decrease) together, and negative when one value decreases as the other increases.
Downside Risk: The financial risk associated with losses – the risk of the actual return being below the expected return, or the uncertainty about the magnitude of that difference
Information Ratio: A ratio of portfolio returns above the returns of a benchmark (usually an index) to the volatility of those returns. The information ratio measures a portfolio manager’s ability to generate excess returns relative to a benchmark.
Margin of Safety is the principle of only purchasing securities when the market price is significantly below its intrinsic value. The difference allows an investment to be made with minimal downside risk.
MSCI World Index: A market capitalization weighted index designed to provide a broad measure of equity-market performance throughout the world. The MSCI ACWI is maintained by Morgan Stanley Capital International, and is comprised of stocks from both developed and emerging markets.
Russell 1000 Growth is an equity index the measures the performance of the large cap growth segment of the US equity universe. It includes those Russell 1000 companies w/ higher price to book ratios and higher forecasted growth values.
Sharpe ratio: A statistical measure that uses standard deviation and excess return to determine reward per unit of risk. A higher Sharpe ratio implies a better historical risk-adjusted performance.
Upside/Downside Capture Ratios: A technical indicator that shows the relationship between the volumes of advancing and declining issues on a stock exchange. The upside/downside ratio is used to determine the momentum of the market at any particular time. Port Street Institutional Opportunities Fund is distributed by Quasar Distributors, LLC.
Systematic Investment Plans do not assure a profit, nor do they protect against a loss in a declining market.