As geopolitical risks from the Middle East have increased volatility in major markets, the volatility index (VKOSPI), known as the "Korean fear gauge," has also whipsawed intraday, amplifying investment uncertainty.
December & Company, which operates the artificial intelligence (AI) investment service Fint, said on the 6th that among algorithm managers providing robo-adviser discretionary services for retirement pensions, the average of its retirement pension algorithms showed the best results in "standard deviation," "maximum drawdown," and "reward ratio."
As of the 31st, according to the Koscom Robo-Adviser Testbed Center, the standard deviation, an indicator that shows volatility in earnings, was 0.06, far better than other retirement pension algorithm managers' average (0.089) and minimum (0.158). The company said that because a lower figure indicates more stable management, it is assessed as an indicator supporting Fint's stable management capability.
The maximum drawdown, which means the largest drop from the peak, averaged –5.33%, the lowest level compared with other firms' average (–9.16%) and minimum (–14.99%). The reward ratio (4.28%), which shows the efficiency of earnings relative to the risk borne by investors, also far outpaced other firms' average (3.19%) and minimum (2.64%).
This defensive strength appears to have carried over to individual algorithm performance. When the KOSPI 200 index fell 17.34% over the past month (as of Mar. 31), December Autonomous Driving Sports Mode P (aggressive) fell only 0.39%. Fint's algorithms' cumulative return averaged 27.4%.
A December & Company official said, "Robo-advisers (RA) are proving to be a superior alternative to existing default options not only in defending against short-term downturns but also in terms of long-term profitability," adding, "For retirement pensions and other old-age funds, it is far more important how well my asset is protected in a downturn than any temporary return."