You can’t control performance.
You can manage risk.
Overcoming Industry Inertia
For decades, advisors have picked and churned through money managers based on past performance. It’s time-consuming, misleading, and not your main value-add. Ready to break through the inefficient cycle?
Manager “Research” Seeking Returns
Advisors pick and choose the “best” portfolios based on historical returns
Our 3-Step Solution
Define Drawdown Risk
Vague terms like "conservative, moderate, or aggressive" fail to quantify the investor's most important risk metric: capital loss, measured by drawdown. The RiskFirst process is designed to keep investors within drawdown guidelines based on defined risk-tolerance objectives.
Investor expectations should be based on a range of potential returns aligned with their risk budget. Our portfolios are built to operate with 95% probability within an expected range.
Pair Strategic with Tactical
Redwood Engineered Risk-Budgeted portfolios combine the benefits of strategic long-only and tactical risk management investment styles. Every ERB portfolio operates sub-strategies that can fully participate – or tactically can go risk-off.
Stays invested to capture strong market rallies
May incur larger drawdowns amid market crises
Can move into defensive positions to mitigate portfolio drawdown
May miss initial upside in a recovery — or buy back in higher than sell point
Engineered Risk-Budgeted Portfolio
Redwood’s Engineered Risk-Budgeted (ERB) portfolios seek to mitigate drawdowns by diversifying both asset classes and investment styles. The ERB models incorporate tactical mandates to maintain beta exposure during upside, with the flexibility to move risk assets to safe havens – such as cash and short-term treasuries – during downturns.
Designate Drawdown Limits
Our portfolios are designed to keep the investor on track and within their risk budget. We engineer each portfolio with the objective to stay within drawdown limits based on the investor’s defined risk tolerance.
What is your drawdown tolerance (DT)?
Focus on Client Service
Redwood operates as a true business partner, providing the models, materials, and metrics you need to achieve practice growth through client satisfaction.
Show clients they are on track when a portfolio stays within two key metrics: drawdown budget and range of expected returns.
Proactively engage clients via letters, market reports, and commentaries — weekly, monthly, and quarterly — all “white label” in your brand.
Leverage Our Library
Utilize Redwood-curated insights, case studies, advisor best practices, and other materials designed to help you refine your narrative and better serve clients.
Impact for RiskFirst® Partners
28%* – average annual AUM growth for RiskFirst® adopters.
When your clients are aligned with their financial goals, it doesn’t build just credibility and trust – it builds your business.
75% of advisors work on a team of three or fewer staff.
Leverage Redwood’s decades of investment and operations expertise to amplify your in-house capabilities.
77% of advisors’ time goes to meeting with clients and prospects.
Redwood manages portfolio construction and investment research – so that you can focus on client service.
How to Implement RiskFirst®
To begin, a Redwood Advisor Analyst (AA) will help you evaluate if your business is a good fit for the RiskFirst process.
Your dedicated AA facilitates the due diligence research process, answering questions, furnishing resources, and resolving any issues.
Receive a seamless transition strategy as your AA delivers proven resources tailored to your business goals, ensuring a smooth implementation.
Start defining your performance narrative around drawdown risk budget and the ability of client portfolios to stay in range.
Unlock hand-in-glove support from our in-house operations team to simplify the trade execution process.
Distribute timely, curated materials – market updates, quarterly commentaries, and topical letters – branded to your business.
Enjoy ongoing RiskFirst partnership support from your AA when addressing client-specific needs and while evolving, scaling, and growing your practice.
ERB Model Matrix
Redwood ERB TD iRebal® MMC Matrix
Redwood ERB Morningstar® MMP Matrix
Redwood ERB Model Matrix (Fidelity)
Redwood ERB Model Matrix (Schwab)
Redwood ERB Pershing Matrix
Redwood ERB LPL Financial Matrix