Keeping in line with our investing strategies, our logo is derived from the time-tested principles of Modern Portfolio Theory.

 

Modern portfolio theory is a method of investing that allows an investor to choose a level of risk with which he/she is comfortable and then identify a portfolio which produces a return commensurate with that risk.

The efficient frontier, the inspiration for the Alhambra Investments logo, identifies those portfolios which most efficiently match the risk and reward of the investor.

 

The individual assets included in the portfolio may have risk-reward characteristics which fall inside the efficient curve. An investor should seek to construct a portfolio by combining the individual assets to produce the highest return for his/her chosen risk tolerance. This portfolio would land on the efficiency frontier.

An investor could further enhance the efficiency of the portfolio by adding a risk-free asset such as treasury bills to the portfolio. This will create a portfolio which falls on the lower left portion of the Capital Asset Line (CAL). An investor seeking maximum gain, while still controlling risk, could use borrowed funds to add leverage and create a portfolio which falls on the upper-right portion of the CAL.

As demonstrated above, even the design of our logo is well-thought out.