michael.pendergrass
Acronym
Adaptive Investment Solutions, LLC
Product ID
Adaptive-Risk-Analytics
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Description
Factor analysis, forward & back tests for DIY downside protection.
Images
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Details
- Adaptive can flag concentrations of risk within a portfolio, for example identifying the stocks with outsized contributions to a portfolio’s overall volatility.
- Sometimes you will see that a more volatile position (higher dot) can contribute less to the overall portfolio risk (shorter bar) than a less volatile position which has a bigger weight in the portfolio.
- The portfolio’s overall risk may be lower than individual components thanks to the benefits of diversification, which is a powerful allocation strategy for reducing risk.
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Details
- Select portfolio to measure a portfolio’s fit compared to various market indexes in pursuit of cost-effective, right-sized market hedges. This can produce meaningful savings for downside protection.
- Adaptive Factor Analysis does the heavy lifting to identify and right-size a market index—or a combination of indexes—which helps explain the performance of the portfolio, and can lead to significantly more cost-effective hedges.
- A basket of liquid market indexes is often less expensive than hedging a portfolio’s individual equity positions, albeit with measurable trade-offs in tracking error and correlation.
Features
Factor analysis, forward & back tests for DIY downside protection:
- Risk Contribution. Portfolio risk of individual holdings.
- DIY Protection. Customized shopping list of put options.
- Backtests & Monte Carlo. Model protection costs & benefits.
Management Style
Schwab Products
Solution