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Dynamic US Equity

Active Equity US
  • Benchmark S&P 500® Index
  • Inception Date August 1989

Strategy Overview

Mellon’s Dynamic US Equity strategy (DUSE) is a versatile, index-based active equity strategy designed to deliver excess returns with benchmark-like risk.

Objective

DUSE seeks to outperform the S&P 500® Index while maintaining a similar level of risk. The strategy’s historical excess returns exhibit very low correlation to its peer group, including traditional stock selection and factor based approaches.

Approach

DUSE applies the widely recognized academic theory of the Capital Asset Pricing Model (CAPM) and the Capital Market Line (CML) to develop a portfolio of three broad exposures (S&P 500®, long Treasury bonds, and cash) designed to outperform the S&P 500® Index with a similar level of risk.

The strategy allows for modest leverage (up to 50%) to dynamically allocate across these three broad exposures or risk premium. By design, fundamental valuation, macro, volatility and tail risk management are incorporated into the strategy, which historically has led to low downside participation and high upside participation.

Please note that all investment strategies involve risk.

PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS.