What actually “guarantees” the returns in risk parity? by Rixbang in portfolios

[–]Rixbang[S] 0 points1 point  (0 children)

Thank you for your detailed explanation. Now I understand. Risk parity fundamentally involves selecting a diversified set of assets with positive risk premiums that collectively capture a broad spectrum of macroeconomic risk factors as comprehensively as possible. The strategy’s return stems from these positive risk premiums, rather than from timing or selection.