How about a methodology that can sort out potential winners from losers?
How about a unique rating for price trends that offers an edge in identifying the majority of the 50% best performing stocks to hold and 50% of the underperformers to avoid with a 12 months time horizon?
Too good to be true? Just give us a chance to prove it to you.
A simple overlay of our robust rating and ranking of trends across your investment universe can help you to get the most out of your carefully conceived investment strategy. We can add a new intelligence layer to maximize returns and reduce performance risks.
A Wealth Manager’s primary goal is to protect client assets by avoiding exposure to unnecessary risks.
But risks are there all the time. The false sense of security in owning Large Cap, brand name stocks, is hard hit when stocks like General Electric and Kraft Heinz lose 60% of value in a matter of 2 years (2017-2019).
New metrics and more advanced tools of risk control are required.
Trendrating empowers wealth managers with well validated analytics and technology that deliver benefits in terms of investment returns and performance protection.
The vast majority of active mutual funds underperform their benchmark (Source: S&P SPIVA). Security price action is showing an increasing disconnect with underlying fundamentals resulting in long periods of underperformance for active managers. The result of rapidly changing market dynamics, and the growing allocation of funds to passive strategies is further exacerbating this disconnect.
We believe that this underperformance can be mitigated by adding a layer of intelligent trend analysis to most fundamentally focused investment processes.
The statistics on the underperformance of mutual funds make a compelling case for a more structured use of proven, sophisticated analytics that objectively and systematically assess the direction and the quality of price trends, while filtering out price noise. Trendrating is a valuable complement to fundamental metrics in delivering alpha.
Markets behavior is evolving as new products, algorithms and systematic investing generate a multi-dimentional risk environment. Self-feeding trends, with large pools of money following momentum, the only investing factor that self-reinforce as more adoption grows, pose a new challenge to traditional risk management methodologies.
At Trendrating we believe that one big risk today is the performance risk. The risk of underperforming and of continuing to underperform with impeccable consistency.
We provide risk managers with the methodology, the metrics and the technology to effectively cope with this risk.
Proactive, well informed, timely advisory makes a big difference to end-clients. Retaining and growing advised assets is challenging and advisors need the best tools available.
Exceed your clients expectations by using the same sophisticated intelligence and advanced systems that power the most competitive and successful institutional investors.
Value investing is struggling to remain relevant. The main reason is the inexorable rise of hard-to-analyze intangible assets (The Economist, Nov 12th 2020). It is a fact that on average value based strategies underperformed benchmarks and other active strategies over the last few years. But there is an opportunity for value investing to step up and generate better returns.
Not every good value story will prove to be a rewarding investment in a reasonable time frame. The key is adding an intelligent filter to assess actual price trends across a defined value stocks universe. This allows for a practical, logical discrimination between value stocks in a “Bull” trend, as the market is recognizing the opportunity vs. value stocks in a “Bear” phase, where the current money flow is negative.
Value investors can bring new life and gain an advantage with a disciplined synchronization with individual stocks trends, profiting from an intelligent “Trend Validation” across the selected value picks. Incorporating Trend Validation by utilizing a disciplined systematic approach as an overlay can greatly enhance returns for Value Investors.
Disciplined Trend Validation investing, if based on statistically proven methodologies, can be hugely rewarding. A research paper, “Fact, Fiction and Momentum Investing”, by Moskowitz, Frazzini, Asness and Israel (2014), shows that managers can improve the efficiency of their portfolios by using investment vehicles which incorporate both Value and Trend Validation strategies.
Many types of Trend Validation strategies can be constructed through Trendrating and layered onto Value strategies. We make it easy for fund managers to test any model with our “Strategy Management Solution” product to measure actual impacts on returns. By incorporating the most sophisticated Trend Validation Factor Model in the financial industry, Trendrating is a perfect complement to Value focused strategies adding enhanced performance, risk control and better diversification.
“By 2025, 30% of the actively managed portfolios will be run by models, with the experts focusing on the macro decisions and the selection of models“ – Rocco Pellegrinelli, Founder and CEO
The systematic Management of equity portfolios is a good alternative to the discretionary management approach. It can improve performance, efficiency and save costs.
Leading groups like BlackRock are shifting the management of some funds from experts “humans” to models. Read the full article
In the hedge funds community the largest player is AQR who is exclusively using a systematic methodology. Read the full article
With fundamental active management increasingly struggling to deliver consistent outperformance versus benchmarks over the medium-to-long term, a systematic model-driven decision-making solution offers investors the necessary tools to address the increased complexity of stock trends. Importantly, by its very nature, such a solution is able to avoid a number of the pitfalls of human judgement and behavioral drawbacks that often negatively impact an investment process.
Due to the limits of the discretionary approach, 82% of active large-cap core stock fund managers over the past 10 years had under performed the S&P 500 ending of 2021, according to the latest SPIVA research.
Does it look too good to be true?
Test any strategy yourself using our powerful, point-and-click Strategy Management Solution.
Analyze and compare the statistical evidence, start profiting from the performance dispersion in your selected investment universe.