The Boston-based investment firm Windham Capital has developed a new set of risk measures, around which to base its investment strategies, which manages risk as a cycle and takes into account the connected nature of the economy.

The firm says the proprietary risk measures which make up the Windham Investment Risk Cycle process address the "hidden linkages" in the economy.

The measures include turbulence, which gauges the interaction among a wide set of assets and is supposed to anticipate sell-offs, and systemic risk, which is designed to reflect a market’s “fragility” depending on its price correlation with unrelated sectors.

This way of assessing risk is supposed to go into greater depth about how it evolves and spreads in the economy, and thus allow investment throughout the entire risk cycle, according to Windham.