Interview with Pierre Gallice, Deputy Head of Alternative & Risk Mitigation Strategies at Ellipsis AM — Alternative & Private Equity Forum
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At the Alternative & Private Equity Forum, we met with Pierre Gallice, Deputy Head of Alternative & Risk Mitigation Strategies at Ellipsis AM. He discusses the limitations of traditional portfolios in the face of crises and the importance of integrating risk management strategies capable of transforming volatility into reinvestment opportunities.
Beyond Diversification: The Challenge of Correlation Shocks
Pierre Gallice points out that periods of extreme stress often highlight the vulnerabilities of traditional asset allocations. Even when widely diversified, many portfolios suffer from correlation shocks, where all risky assets decline simultaneously.
To address this, he advocates for risk mitigation solutions with a truly negative correlation, capable of protecting capital and strengthening the overall resilience of the allocation during market crashes.
Transforming hedging into a performance driver
Protection should no longer be viewed as a mere cost. It is becoming a strategic investment category in its own right.
The challenge lies in monetizing gains generated during downturns to create liquidity at the right moment. This approach allows for reinvestment in undervalued assets—whether equities or credit—and more effectively captures the rebound, thereby optimizing long-term performance.
The alternative portfolio as a pillar of resilience
Given the limitations of the traditional 60/40 model, Pierre Gallice recommends allocating approximately 20% of the portfolio to a diversified alternative portfolio.
This segment plays a key role in cushioning drawdowns while maintaining exposure to growth potential. By promoting agile rebalancing during market shocks, this approach sustainably strengthens portfolio resilience and improves the quality of compound returns.
Read the full interview to understand Ellipsis AM’s strategy and the evolution of risk management in the markets.
About Ellipsis AM
Ellipsis AM is an asset management firm specializing in niche assets, including convertible bonds, credit, and volatility. It supports investors with innovative risk mitigation solutions to optimize portfolio resilience.
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