Risk Management:

Managing market risk

We view risk primarily as the prospect of losing our clients’ capital, rather than any short-term volatility or tracking error (i.e. underperformance relative to a benchmark). Our stock selection process is core to the management of risk. In particular:

  • As a result of our bottom-up investment process, the key portfolio risks are the specific risks associated with each individual stock in the portfolio. We view stock-specific risk as a function of our knowledge of the business and seek to manage this by means of meticulous research, robust peer review and ongoing monitoring. Our index-agnostic approach allows us to control the absolute risk of the portfolios.
  • Our particular focus on companies that are out of favour with the market means that we purchase shares when their price is already discounted relative to their intrinsic value. Our experience has shown that the depressed entry price can inherently limit downside risk.
  • Appropriately calibrating the weight of each position within a portfolio based on the merits of each investment case is another important means of risk management in our process. We avoid excessive concentration in a portfolio and the diversification guidelines of our funds and mandates help to manage portfolio risk without unduly restricting the investment process. Under most of our mandates, the portfolio will seldom invest more than 5% of its net asset value at the time of investment in the shares of a single issuer.
  • Within a portfolio, care is taken to avoid excessive exposure to areas that have a high co-variance. This may be considered by industry or country. Within a country, there are other considerations such as susceptibility to currency fluctuations, interest rates and government actions. At the industry level, consideration will be given to the nature of its structure, such as concentration, cyclicality, relative maturity, threat of substitution and so on. Regular analysis highlights the profile of the portfolios by geographic, industry, emerging market, liquidity and other characteristics.
  • When the market experiences widespread excessive exuberance and undervalued stocks become scarce, we will increase our cash holdings and reduce our net equity exposure to protect the portfolio.
  • Similarly, we may short-sell stocks and indices that have been identified as being extravagantly overvalued by the market (where permitted under the mandate). Short-selling may be employed as a means to limit risk by reducing a portfolio’s net invested position. It may also be undertaken with the aim of increasing returns by seeking to profit from a fall in the share price of a particular company or the prices of a sector or market more broadly, as represented by indices. Short positions in our portfolios are generally established through equity swaps, which are cash-settled non-deliverable contracts.
  • bjective measures of a portfolio’s aggregate characteristics (in terms of growth, profitability, leverage and value) are conducted periodically.
  • From time to time, we utilise derivative instruments to manage risk, including (subject to mandate restrictions):
  • selling index futures or buying index put options to reduce market risk in a portfolio;
  • buying call options or warrants over a security to reduce the cost or potential downside of holding a given stock; and
  • where we have identified stocks that we believe to be overvalued, buying put options over those stocks or short-selling them.
Managing currency risk:

International equity investments create an exposure to foreign currency fluctuations which are affected by factors such as interest rate differentials, economic performance, trade flows, purchasing power parity measures, and government policies. Movements in foreign exchange rates can change the value of the equity investments measured in a portfolio’s reporting currency. It is a component of Empire Crypto Market’s investment process to assess the potential returns and risks created by currency exposure and position the portfolios appropriately to attempt to capture those returns while minimizing those risks.


The aim is for each portfolio to be exposed to the greatest extent possible to appreciating currencies and for its exposure to depreciating currencies to be minimized.


We actively manage the currency exposure of our portfolios using foreign exchange forward contracts, currency swaps, non-deliverable forward contracts, and currency options, as well as spot foreign exchange trades (where permitted under the mandate).


More generally, our investment process involves assessing the indirect impact of currency on a business (e.g. the impact of currency fluctuations on a manufacturing company with significant export sales), and the potential for exchange rate movements to amplify or diminish the returns earned from our investment in a company when translated into reporting currency. Cash positions may also be held in portfolios taking into account the potential currency impact (as well as interest rate and credit risk considerations).

Terms and Conditions of Empire Crypto Market

Welcome to Empire Crypto Market, a platform designed to facilitate cryptocurrency investments. By accessing or using our platform, you agree to abide by the following terms and conditions:

  1. Eligibility:

    • You must be at least 18 years old and legally capable of entering into contracts to use our platform.
    • Residents of certain jurisdictions may be restricted from using our services due to local laws and regulations.

  2. Investment Risks:

    • Cryptocurrency investments are subject to market risks, including volatility and potential loss of investment.
    • You acknowledge that past performance is not indicative of future results, and we do not guarantee any returns on your investments.

  3. Account Registration:

    • You must provide accurate and complete information during the registration process.
    • You are responsible for maintaining the confidentiality of your account credentials and for all activities that occur under your account.

  4. Investment Products:

    • We offer various cryptocurrency investment products, including but not limited to trading accounts, investment portfolios, and savings plans.
    • Each investment product may have its own terms, conditions, and associated risks, which you must review before investing.

  5. Fees and Charges:

    • You agree to pay any applicable fees or charges associated with your use of our platform and investment products.
    • We reserve the right to modify our fee structure at any time with prior notice to users.
    • The company's system is automated and cannot be manually operated; disputes arising from duplicate deposits are solely your responsibility and are to be rectified by terms determined by us.

  6. Compliance with Laws:

    • You agree to comply with all applicable laws, regulations, and tax obligations related to your use of our platform and investment activities.
    • You are solely responsible for determining the legal implications of your cryptocurrency investments in your jurisdiction.

  7. Security Measures:

    • We employ industry-standard security measures to protect your personal information and digital assets.
    • However, you acknowledge that no security system is completely foolproof, and we cannot guarantee the absolute security of your data or assets.

  8. Termination of Services:

    • We reserve the right to suspend or terminate your access to our platform at any time, with or without cause, and without prior notice.
    • In the event of termination, you will remain responsible for any outstanding obligations incurred before termination.

  9. Limitation of Liability:

    • To the fullest extent permitted by law, we disclaim any liability for damages arising from your use of our platform or investment products.
    • Under no circumstances shall we be liable for any indirect, incidental, consequential, or punitive damages.
    • Should you make any errors with the use of your account or breach of your account security, you are solely responsible for such errors; ECM reserves the right to discontinue working with you.

  10. Amendments to Terms:

    • We reserve the right to update or modify these terms and conditions at any time without prior notice.
    • Your continued use of our platform after such changes constitutes acceptance of the modified terms.

  11. Governing Law and Dispute Resolution:

    • These terms and conditions shall be governed by and construed in accordance with state laws.
    • Any disputes arising out of or relating to these terms shall be resolved through arbitration in accordance with the rules set out between the involved parties (ECM and Investor).

By using our platform, you acknowledge that you have read, understood, and agreed to be bound by these terms and conditions. If you do not agree with any part of these terms, please refrain from using our services.

Empire Crypto Market reserves the right to refuse service to anyone for any reason at any time.