Mark Kritzman, CEO of Windham Capital Management in Boston, has been developing quantitative risk management strategies for over 20 years, but the growth of ETFs has enabled him to put his ideas to work for investors. Last month his firm’s assets under management reached $1 billion, all of which is invested in ETFs that portfolio managers buy and sell based on how choppy or calm the market looks at the time.

And right now, Windham is weighting its allocations toward equity and high-yield debt ETFs, especially ETFs that track emerging-markets debt and equities, along with small-cap non-U.S. equities and commodities. These are assets that show a low correlation with traditional equity risk factors, says Lucas Turton, the firm’s chief investment strategist.

Kritzman, who teaches financial engineering at the Massachusetts Institute of Technology’s Sloan School of Management and has written widely about constructing portfolios to withstand multiple risk regimes, started Windham in 1988 as a base for his advisory services. Over the years the firm also managed currency strategies for the Rockefeller Foundation and other institutional clients, and became part of State Street Associates, a think-tank that Kritzman co-founded. In 2009, the firm began offering its own portfolios, “starting with nothing,” says Turton. The assets grew slowly, to $50 million at the end of 2009, but reached the $1 billion mark in October with a $250 million investment from the Maine Public Employees Retirement System.

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