Presentation Video

What we offer?

  • For retiree investor portfolios seeking lower risk and consistent higher non correlated returns to diversify portfolio. Address sequencing risk market fall scenario 
  • Absolute returns and income with protection always in place (dynamic hedging).
  • Non correlated returns in rising and falling markets.
  • Regular quarterly income class A BBSW3M + 3%; class B BBSW3M +6%
  • Dynamic hedging risk management: Protection always in place adjusted with market moves (not set and forget).
  • Daily liquidity and no lock ins
  • Track record of returns increasing with market volatility

Portfolio Construction

To achieve diversification benefits, a portfolio needs to invest in non-correlated assets, which are assets that have a different return profile from the market and from each other. The degree of correlation between the assets can be measured by beta, which is the sensitivity of the asset return to the market return.

Diversification benefits:

  • Lower risk: Protection via an options overlay is always in place to avoid large losses
  • Higher returns with alpha from ‘dynamic hedging’ - takes advantage of differences in option prices
  • ‘Dynamic hedging’ is a more reliable non correlated beta as protection increases in value on market falls. Gyrostat class A has consistently delivered non correlated returns (eg 5 year beta of -0.20)

The performance of the Gyrostat Absolute Return Income Equity Fund Class A since inception in December 2010 versus the 5 worst quarterly performances of the ASX200 accumulation index were:

Gyrostat Investment graph

The Gyrostat Risk Managed Equity Fund offers five classes of units;

Each Class has differing risk-return characteristics, but all Classes are based on the ‘dynamic hedging’ risk managed approach with protection always in place. Each class is backed by a Class specific pool of assets and liabilities held on a segregated basis.

With protection always in place we aim to provide alpha excess returns by avoiding large losses through the complete investment cycle.
We offer two absolute return fund classes, non correlated with the stock market.
Class A is our flagship fund. Blue chip shares with protection for retiree income. This is specifically designed to address sequencing risk with a downside tail always in place for gains on large market falls.

Class B is a leveraged version, with a focus on greater returns with less risk protection.

We also offer Gyrostat Risk Managed Australian (class C), Hong Kong (class D), and global (class E) designed to outperform their specific benchmark index over rolling 12 months by avoiding large losses through the complete investment cycle. 

Risk management – protection always in place (dynamic hedging)

In today's turbulent financial market, managing investment risk is crucial for ensuring long-term success for equity managed funds. One of the most effective ways to manage risk is dynamic hedging, which involves adjusting the protection positions of a portfolio in real-time based on market changes. This strategy is used by sophisticated fund managers with the systems to continuously monitor market conditions and know how to adjust their portfolios accordingly.

Gyrostat uses dynamic hedging to manage the trade-off between returns, income, and protection levels (risk). Our approach has focused on a pre-defined quarterly ‘hard’ risk parameter, and then to maximise returns and income within that constraint. A secondary consideration is the source of returns, in particular the level of correlation with the market. From established finance theory adding non correlated assets is of significant value to the overall portfolio, so the Gyrostat approach has been to generate returns in rising and falling markets, which increase with volatility. 

Gyrostat three step dynamic downside protection

Superimpose a 'hockey stick' pay off at all times on a share price chart, moving the protection level on market moves. 

  1. Buy and hold blue chip shares with protection on the Stock Exchange Gyrostat Hockey
  2. Set the amount of protection to always participate in the upside with minimal capital at risk
  3. Re-set the protection level on market moves - if the share price rises increase the protection level, on falls reduce the protection level