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Risk Management

RISK MANAGEMENT - “Seeing over the market’s horizon”

We seek to manage risk in order to capitalize on opportunities and improve our performance in a Volatile and unpredictable digital market space. Disciplined risk estimation and management are deeply integrated components of the investment process across each one of our strategies.

We believe a well-constructed portfolio upfront will outperform in good markets and protect our client’s capital in difficult markets. For this reason, Firefox-Capital has spent years establishing risk management as a core discipline. This approach begins with a dedicated governance group that oversees risk management. An emphasis on Volatile altcoin markets, proprietary risk models and a diversified funding structure seeks to further strengthen our approach.

WAYS TO MITIGATE RISK

A DEDICATED RISK MANAGEMENT TEAM

Operating independently of the investment businesses, and reporting to the Executive Board of Directors , our Portfolio Risk and Exposure Group (PREG) guides the allocation of risk capital. It is supported by a dedicated R&D team to create custom tools and technologies. Firefox-Capital’s Risk Management team provides a comprehensive view of the various investment portfolios and how they fit within pre-established guidelines.

RUN RIGOROUS PROCESSES

In pre-trade discussions, the Portfolio Construction and Risk group works to identify the impact of potential trades on a portfolio’s risk and stress exposures. In the ex-post analysis, the group evaluates the skill, infrastructure, investment universe, risk and working capital utilization of each business, and uses this information as a part of the risk capital allocation process.

REINFORCE THE CULTURE

A solid framework is important, but successful risk management can only be accomplished when it becomes a central part of the portfolio manager’s analysis of potential trades and portfolio construction. Continuous communication and collaboration with the investment teams, combined with an in-depth understanding of the portfolios, play a critical role in maintaining and strengthening our risk culture.