The Horizon Fund is a buy and hold, diversification, non-directional, value and event driven defensive fund in primarily two asset classes as follows; 1) Natural Catastrophe Bonds (exposed to earthquake, windstorms, hurricanes etc) - Target spread to expected value, but also look for opportunities to diversify within perils, and 2) Weather derivatives (exposed to temperature, rain, snow etc) - Active trading and hedging involved where appropriate, but focus on hedging end-users with genuine risks. All trades structured to have capped downside.
Principles of risk diversification are observed. For example, the Fund limits its exposure from a geographical point of view and from a risk (such as earthquake, wind storms, rain, temperature etc) point of view to a set percentage of its investment capacity. This way the Fund is not exposed to systemic risks. Cash and short-term securities are restricted to the highest credit quality instruments.