A new approach for a new type of risk

Investment technology managing risk Investment technology managing risk

The Syntax Approach

Syntax is revolutionizing passive investing by managing a category of risk not currently addressed: Related Business Risk. Using patented investment technologies developed from nearly two decades of rigorous research, Syntax Indices diversify business risk based on information from the real economy. The result is better diversification.

Indices Diversify Business Risk Indices Diversify Business Risk
related business risk economic system

RBR: A New Class of Risk

For too long, investors have been exposed to a type of risk that has not been adequately identified, let alone addressed, in the marketplace. We call this risk Related Business Risk (RBR). By leveraging nearly two decades’ worth of economic research, Syntax has developed a solution designed to identify and manage this type of risk.

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Functional Information System

FIS: Sequencing Business DNA

To identify Related Business Risks, Syntax uses its patented multi-attribute Functional Information System (FIS).

Just as every person has 23 unique chromosomes that carry our genetic information and make each of us who we are, each company in the economy has its own set of “chromosomes” – products, services, employees, customers – that make it unique.

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science controlling risk

Stratification: The Science of Controlling Risk

Syntax controls for Related Business Risk through a new category of index weighting methodology called stratification. The objective of stratification is to create a more diversified index by spreading exposure to Related Business Risks. If left uncontrolled, an index can become dangerously concentrated in a particular Related Business Risk that negatively impacts its performance.

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stratified performance across sectors

The Stratified Performance Difference

The key to Syntax’s Stratified-Weight performance comes from controlling for Related Business Risk events. See how controlling for such events has demonstrated outperformance across sectors, geographies and market environments.

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stratified-weight benchmarks

Stratified-Weight: Building Better Benchmarks

The stratified-weight index is a new category of benchmark index that serves as a market barometer alongside capitalization-weight and equal-weight benchmarks. While cap-weighting provides a measure of aggregate market performance and equal-weighting provides a measure of average company performance, stratified-weighting provides a measure of diversified business performance.

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Past performance is no guarantee of future results. All performance presented prior to the index inception date is back-tested performance, based on the methodology in effect on the launch date. Back-tested performance is not actual performance, but is hypothetical. The inception date of the Syntax Stratified Core, Syntax Stratified Financials, Syntax Stratified Energy, Syntax Stratified Industrials, Syntax Stratified IT, Syntax Stratified Information, Syntax Stratified Consumer, Syntax Stratified Food, Syntax Stratified Healthcare, and Syntax Stratified LargeCap Indices (“the Indices”) is 12/27/2016. The back-test calculations are based on the same methodology that was in effect when the index was officially launched. However, back-tested data may reflect the application of the index methodology with the benefit of hindsight. No theoretical or back-tested approach can account for all market factors and the impact of decisions that might have been made during the actual operation of an index. Actual returns may differ from, and be lower than, back-tested returns, which are not necessarily predictive of future returns. The base index value is set as of 100 as of the initial back-test date of 12/20/1991. Charts and graphs are provided for illustrative purposes only.

The Indices are the property of Locus Analytics, LLC, which has contracted with S&P Dow Jones Indices to calculate and maintain the Indices. The Indices are not sponsored by S&P Dow Jones Indices or its affiliates or its third party licensors (collectively, “S&P Dow Jones Indices”). S&P Dow Jones Indices will not be liable for any errors or omissions in calculating the Index. Calculated by S&P Dow Jones Indices” and the related stylized mark(s) are service marks of S&P Dow Jones Indices and have been licensed for use by Locus Analytics, LLC. S&P® is a registered trademark of Standard & Poor's Financial Services LLC (“SPFS"), and Dow Jones® is a registered trademark of Dow Jones Trademark Holdings LLC (“Dow Jones”). Syntax®, Stratified®, Stratified Indices®, Stratified-Weight™, and Locus® are trademarks or registered trademarks of Locus Analytics, LLC.

Index performance does not represent actual fund or portfolio performance and such performance does not reflect the actual investment experience of any investor. An investor cannot invest directly in an index. In addition, the results actual investors might have achieved would have differed from those shown because of differences in the timing, amounts of their investments, and fees and expenses associated with an investment in a portfolio invested in accordance with an index. None of the Syntax Indices or the benchmark indices portrayed herein charge management fees or incur brokerage expenses, and no such fees or expenses were deducted from the performance shown; provided, however, that the returns of any investment portfolio invested in accordance with such indices would be net of such fees and expenses. Additionally, none of these indices lend securities, and no revenues from securities lending were added to the performance shown. Performance shown is unaudited and subject to revision. This site may include materials and documents containing forward-looking statements which are based on our expectations and projections as of the date made. Past returns are not necessarily predictive of future returns.

The S&P 500® Index is an unmanaged index considered representative of the US large-cap stock market. The S&P 500® Equal Weight Index is an equal-weighted version of the S&P 500® Index. The S&P 400® is an unmanaged index considered representative of the US mid-cap stock market. The S&P 400® Equal Weight Index is an equal-weighted version of the S&P 400® Index. The S&P 900® Index is an unmanaged composite of the S&P 500® and S&P 400® Indices. Benchmark data for the S&P 900, S&P 500, and S&P 500 Equal Weight Indices are provided by S&P Dow Jones Indices. The capitalization-weighted Syntax Stratified sector benchmarks are calculated by Syntax via FactSet®.