Quant ETF Inspired by Ray Dalio Drops the Most Since March 2020
- RPAR ETF is posting its worst five-day streak since Covid hit
- New risk-parity ETF arrives just as stocks and bonds whipsaw
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The new year market turbulence is inflicting the biggest loss since the dark days of the 2020 pandemic on an ETF riding a popular quant trade tied to the decades-long twin bull run in stocks and bonds.
The investing approach known as risk parity has been hammered this week as U.S. equities and bonds declined in unison on hawkish signals from the Federal Reserve. The systematic strategy, popularized by Bridgewater’s Ray Dalio, allocates across asset classes based on risk and tends to suffer outsize losses when markets fall together.