Portfolio exposure refers to the overall risk and return characteristics of an investment portfolio. It is a measure of the extent to which a portfolio is exposed to different types of risk, such as market risk, interest rate risk, or credit risk. Portfolio exposure can be measured in a number of ways, including by the type and diversification of the assets in the portfolio, the amount of leverage used, and the portfolio’s historical performance. By understanding the portfolio’s exposure, investors can make informed decisions about the level of risk they are comfortable with and take steps to manage or adjust their portfolio accordingly.
“The moral is that in trading it’s important to examine the situation from as many angles as possible, because your initial impulses are probably going to be wrong. There is never any money to be made in the obvious conclusions.” – Jeff Yass