THE MATH PROBLEM

The challenge was to find a path through the city that would cross each bridge only once. The problem stated that the path need not start and end in the same place, but that each bridge must be crossed completely.

While it is unsolvable, in proving it so, Leonhard Euler formed the basis for graph theory and presaged the field of topology. Thus, while the problem remains inexplicable, the process of analysis resulted in significant progress in the field of mathematics.

THE INVESTMENT COROLLARY

We believe investment management poses a similarly enigmatic question. It is impossible to know which assets and strategies will have the best risk/return during any particular period, and thus impossible to construct the ‘very best’ portfolio for any environment. This can only be known ex-post with the benefit of perfect hindsight.

THE SEVEN BRIDGES SOLUTION

At Seven Bridges, we undertake the process of asset allocation, strategy evaluation and manager selection to invest in what we believe are the best perceived risk/return characteristics. While impossible to know the exact ‘right’ assets to own at any given time, much is gleaned from the process of analyzing the dynamics. In our view, while always an inexact science, a continuous, detail-oriented investment process optimizes risk/return and exceptional long-term performance.