Our range of solutions

Advanced Analytics Data Feed

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  Trendrating Advanced Analytics Data Feed

  Trendrating Trend Capture Rating (TCR) explanation

Features

Global Ratings

Trendrating covers over 20,000 indices, sectors, ETFs, stocks, commodities and major currencies across 40+ countries.

Ease of Integration

The Trendrating Feed can be delivered in a flexible format and can be easily integrated into third-party platforms such as Factset and Bloomberg or into proprietary systems built using Matlab, R, S-Plus etc.

The ability to capture trends, profiting from bull markets and avoiding bear phases is the key to superior performance on a consistent basis. Investors that have a good understanding and a disciplined respect for the specific price trend of securities outperform competitors. Any investment strategy can be enhanced by a better synchronization to trends developments.

Most investors use numerous metrics based on fundamental and quantitative data, but very few measure in a proven, objective, systematic way, the real direction of price trends and remain hostage to market noise and opinions, despite the fact that capturing trends is the key to better returns.

Traditional indicators from technical analysis and chart pattern studies often yield inconsistent results across different cycles and market types.

Old school momentum investing tends to be late as it uses fixed time windows that may require time to adjust to fast changing trends.

But a new generation of sophisticated models has emerged to fix this.

Trendrating fills a critical gap of market intelligence by providing a methodology to support a better synchronization for individual stocks and sectors trends, that makes the investment decision process more accurately informed about the factor that impacts performance the most – medium term trends.

Trendrating solution is based on a “pattern recognition” algorithm that processes a large volume of data.

The algorithm works on a multi-factor analysis and uses a self-adaptive, flexible time window. When the different factors are in synch there is a high probability that a relevant trend is in place. The dynamic time window enables a more timely identification of an emerging trend and the multi-factor approach supports an effective filtering of price noise, short term volatility and false moves.

Trendrating provides advanced analytics designed to capture trends, identifying most of the winners and avoiding a large part of the losers with in a yearly horizon. Our model offers a unique rating of trends where A and B indicate a bull trend and C and D mark bear moves. We provide a unique edge where A and B rated stocks on average outperform those rated C and D.

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Trendrating has created a new paradigm in terms of accurately spotting trends quickly to capture a large part of any meaningful upward or downward price move.

The “Advanced Analytics Feed” is a powerful complement to the existing analytical process of active equity portfolio managers. The data enriches existing in-house ranking methodologies and can be distributed to the entire investment team as an additional valuation metric to improve the selection and allocation process.

Statistical evidence of the mission critical “EDGE” – A/B outperform C/D

The charts below show the aggregated performance of all the stocks when rated A and B versus those rated C and D.

Performance Management Platform

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  Trendrating Performance Management Platform

  Trendrating Trend Capture Rating (TCR) explanation

The ability to capture trends, profiting from bull markets and avoiding bear phases is the key to superior performance on a consistent basis. Investors that have a good understanding and a disciplined respect for the specific price trend of securities outperform competitors. Any investment strategy can be enhanced by a better synchronization to trends developments.

Trendrating provides advanced analytics designed to capture trends, identifying most of the winners and avoiding a large part of the losers with in a yearly horizon. Our model offers a unique rating of trends where A and B indicate a bull trend and C and D mark bear moves. We provide a unique edge where A and B rated stocks on average outperform those rated C and D.

Trendrating has created a new paradigm in terms of accurately spotting trends quickly to capture a large part of any meaningful upward or downward price move.

Note: The graphs below are a few examples of stocks related ‘downwards’ and ‘upwards’ price moves captured way on time by Trendrating Trend Capture Model, in a specific time window (12 months). Therefore, the reported graphs are of course changed as of today due to the daily market progress. Contact us to discover the updated ratings of the relative securities.

Short guide to the use of Trendrating Performance Management Platform

Trendrating key features:

  • A rich suite of functionality to support different tasks leveraging our rating and ranking analytics.
  • Validate investment ideas and analyst opinions.
  • Identify investment opportunities.
  • Get alerts on critical trend reversals.
  • Analyze, compare and rate sectors.
  • Perform a macro analysis across markets.
  • Fine tune the allocation of sectors and markets.
  • Analyze and optimize portfolios.
  • Control risks across all your holdings.
  • Run a sanity check across portfolios via aggregated portfolio ratings.
  • Create, test and track personalized strategies.
  • Prepare rich and compelling reports.

Strategy Management Solution

The growing complexity of the dynamics that influence trends in the stock markets requires considering the use of advanced analysis tools. Active management can beat the indices, profiting from the dispersion of performance, with the help of new generation content and systems.

Trendrating offers a solution that allows you to explore the effectiveness of the selection parameters used and validate or optimize investment strategies, with coverage of over 17,000 stocks.

The “Strategy Management Solution” allows you to:

  • Replicate your current strategies and test them for up to 10 years.
  • Create alternative strategies for best practice comparison, and possible optimization by choosing parameters from a rich list of data and fundamental analytics.
  • Combine and weigh different approaches (market cap, value, growth, low volatility) to identify opportunities for improving the risk-return profile.
  • Add a trend validation filter on the individual stocks selected, in order to maximize returns and reduce risks.

Finally a powerful, but simple and fast system to allow managers to design, analyze, improve, document and promote their investment strategies.

Leverage your skills and get the most from your investment plans.

Access additional intelligence, gain critical insights and maximize your success.

BUILD YOUR WINNING INVESTMENT STRATEGY

MARKET CAP VALUE GROWTH TREND

Select the rules, create your recipe, test, optimize, validate, document, market, execute.

Example of comparative statistical analysis for the last 10 years.

SAMPLE STRATEGIES COMPARISON

US
universe – 600 large cap stocks   fundamentals only    fundamentals + Trendrating filter  
    annual performance 10 years    annual performance 10 years   
value strategies  rule 1 rule 2  rule 3 strategy S&P 500 difference rule 4 strategy S&P 500 difference added value
P/E 20 largest market cap P/E max 20 9.45% 11.05% -1.60% A and B rated stocks 12.89% 11.05% 1.84% 3.44%
P/E 25 largest market cap P/E max 25 9.20% 11.05% -1.85% A and B rated stocks 12.95% 11.05% 1.90% 3.75%
P/E 30 largest market cap P/E max 30 9.66% 11.05% -1.39% A and B rated stocks 12.85% 11.05% 1.80% 3.19%
P/S 5 largest market cap P/S max 5   8.96% 11.05% -2.09% A and B rated stocks 12.65% 11.05% 1.60% 3.69%
P/S 7 largest market cap P/S max 7   9.62% 11.05% -1.43% A and B rated stocks 13.91% 11.05% 2.86% 4.29%
P/E 25 + P/S 5 largest market cap P/E max 25 P/S max 5 9.78% 11.05% -1.27% A and B rated stocks 12.76% 11.05% 1.71% 2.98%
P/E 30 + P/S 7 largest market cap P/E max 30 P/S max 7 10.08% 11.05% -0.97% A and B rated stocks 13.70% 11.05% 2.65% 3.62%

Europe
universe – 600 large cap stocks   fundamentals only    fundamentals + Trendrating filter  
    annual performance 10 years    annual performance 10 years   
value strategies  rule 1 rule 2  rule 3 strategy STOXX 600 difference rule 4 strategy STOXX 600 difference added value
P/E 20 largest market cap P/E max 20 2.23% 3.93% -1.70% A and B rated stocks 9.84% 3.93% 5.91% 7.61%
P/E 25 largest market cap P/E max 25 2.65% 3.93% -1.28% A and B rated stocks 10.14% 3.93% 6.21% 7.49%
P/E 30 largest market cap P/E max 30 2.99% 3.93% -0.94% A and B rated stocks 9.61% 3.93% 5.68% 6.62%
P/S 5 largest market cap P/S max 5   3.41% 3.93% -0.52% A and B rated stocks 10.22% 3.93% 6.29% 6.81%
P/S 7 largest market cap P/S max 7   3.72% 3.93% -0.21% A and B rated stocks 10.02% 3.93% 6.09% 6.30%
P/E 25 + P/S 5 largest market cap P/E max 25 P/S max 5 3.10% 3.93% -0.83% A and B rated stocks 10.24% 3.93% 6.31% 7.14%
P/E 30 + P/S 7 largest market cap P/E max 30 P/S max 7 3.12% 3.93% -0.81% A and B rated stocks 10.51% 3.93% 6.58% 7.39%

DM Asia
universe – 600 large cap stocks   fundamentals only    fundamentals + Trendrating filter  
    annual performance 10 years    annual performance 10 years   
value strategies  rule 1 rule 2  rule 3 strategy MSCI PACIFIC difference rule 4 strategy MSCI PACIFIC difference added value
P/E 20 largest market cap P/E max 20 1.03% 3.85% -2.82% A and B rated stocks 7.91% 3.85% 4.06% 6.88%
P/E 25 largest market cap P/E max 25 0.52% 3.85% -3.33% A and B rated stocks 7.68% 3.85% 3.83% 7.16%
P/E 30 largest market cap P/E max 30 1.09% 3.85% -2.76% A and B rated stocks 8.55% 3.85% 4.70% 7.46%
P/S 5 largest market cap P/S max 5   2.52% 3.85% -1.33% A and B rated stocks 6.78% 3.85% 2.93% 4.26%
P/S 7 largest market cap P/S max 7   1.66% 3.85% -2.19% A and B rated stocks 6.14% 3.85% 2.29% 4.48%
P/E 25 + P/S 5 largest market cap P/E max 25 P/S max 5 1.20% 3.85% -2.65% A and B rated stocks 6.28% 3.85% 2.43% 5.08%
P/E 30 + P/S 7 largest market cap P/E max 30 P/S max 7 0.95% 3.85% -2.90% A and B rated stocks 7.49% 3.85% 3.64% 6.54%

We have the answers to some of your questions:

  • What are the most effective parameters for value strategies?
  • What for growth strategies?
  • What are the best performing combinations of value and growth rules?
  • What is the benefit to add an overlay of trend validation?
  • How can trend validation be added to my fundamental strategy?

NEW LIFE FOR VALUE INVESTING

In any list of stocks that satisfy whatever value metrics there will be winners and losers. Not every good value play turns out to be a rewarding investment. By adding a layer of proven, objective trend validation it is possible to maximize the exposure to rising stocks while avoiding falling securities, with an obvious impact on performance. Combining good value and trend validation is taking the best of both worlds.

BOOSTING THE RETURNS OF GROWTH STRATEGIES

Growth investing is a rewarding strategy that can be enhanced with a better synchronization to the actual price trends. Growth stocks that also display a clear bull trend are preferable to growth securities that for some reason are not rewarded by price action. Investors liquidity flows can be driven by several factors. A solid trend quality confirmation can easily refine the selection and boost returns.

BEAT THE BENCHMARK WITH INTELLIGENT “TREND ALLOCATION“ ANALYSIS

THE GOLD MINE OF PERFORMANCE DISPERSION

The edge. Trendrating solution offers mission-critical portfolio intelligence via the “Trend Capture Rating“ (TCR) for active portfolios. The TCR is the aggregated, weighted rating of all the holdings. It provides a clear-cut metric to evaluate and audit a portfolio in terms of the actual exposure to stocks in a well-defined bull trend versus securities in a clear bear phase. The higher the TCR the better the expected portfolio performance. The portfolio rating provides a measure with a strong predictive value in terms of relative returns.

“The analysis of portfolios allocation across positive and negative trends is a rock-solid metric with predictive value about relative returns when associated with a similar analysis for the benchmark“.

TCR is a game changer for active managers.

Active managers underperform the benchmarks.  According to SPIVA statistics 78% of US large cap funds underperformed the SP500 index for the five years ending in June 2020.

The performance dispersion is the opportunity for active managers to beat indices. For the year 2020 in the universe of the 500 large cap US stocks, the top 25% performers produced an average gain of around 110% (minimum 39% and maximum 420%) and the bottom 25% performers posted an average loss of -18% (from -4% to -62%). The SP500 index recorded a gain of 16%. The performance dispersion is an excellent opportunity for active managers with the right tools to capture even a small part of the top performers while avoiding most of the big losers.

This table simulates a strategy that was exposed 20% to the top performers (average return), 20% to the bottom performers, and 60% to stocks with the same performance of the benchmark:

It shows how by just capturing part of the performance dispersion in 2020 an active manager could have outperformed the SP500 index by 12 points.

The performance dispersion can be observed in any universe of stocks, selected on whatever factor (value, growth, ESG, etc.) and  the opportunity to profit from dispersion while remaining consistent with the specific investment focus is a fact too often underappreciated and underexploited.

Profiting from dispersion. Fundamental analysis alone proves to be of little help, if we look at the mutual funds industry performance, where often fundamentals and opinions are the main foundation of the decision process.

Alternative data and advanced analytics can help. Alternative data and advanced analytics can deliver value that can make a measurable difference to beat the benchmarks. Adopting new generation, state-of-art content and tools seems to be the only way to change the game for many active managers.

The solution. Successfully navigating price trends is the key contributor to performance. Trendrating is a leading provider of advanced analytics and technology specifically designed to profit from performance dispersion and enhance returns.

For example if a portfolio TCR is B and C and D rated stocks make 30% of the portfolio while the benchmark TCR is B+, because C/D securities make only 15% of the index, then the probability for the active portfolio to beat the benchmark is low.

By raising the TCR of the portfolio at B+ or higher the chances to outperform substantially increase.

Applicability. Trendrating analytics add mission-critical intelligence to any investment approach and focus (Value, Growth, ESG, Size, Volatility, etc). Adding TCR analysis can remarkably improve the performance of fundamental-driven investment strategies, combining good fundamentals with proven price action predictive analytics.

Use the Trendrating Performance Management Platform to perform a pragmatic, disciplined analysis of your portfolios allocation across positive and negative trends compared to the benchmark trends distribution as a predictive metric of relative performance.

This sample portfolio shows a lower TCR than the benchmark (B vs. A-) due to the fact that C and D rated stocks makes 35% of the exposure vs. only 14% on the index. The probability to beat the benchmark is extremely low.

Changing the exposure away from negatively rated stocks is advised.

Expand your opportunities.

Contact us and quickly see how our Strategy Management Solution can deliver more value to your business.

PORTFOLIO SENTINEL (PLUS)

Portfolio Management is becoming more complex and challenging. Delivering superior returns for active managers and stock selectors on a consistent basis requires the adoption of advanced analytics and state of the art technology.

Price trends are impacted by a variety of factors that go beyond the purely fundamental metrics.

Make Trends work for you

The ability to capture trends, profiting from bull markets and avoiding bear phases is the key to superior performance on a consistent basis. Investors that have a good understanding and a disciplined respect for the specific price trend of securities outperform those that don’t.

Any investment strategy can be enhanced by a better synchronization to trend development.

Most investors use numerous metrics based on fundamental and quantitative data, but very few measure in a proven, objective and systematic way, the real direction of price trends and remain hostage to market noise and opinions, despite the fact that capturing trends is the key to better returns.

Trendrating filling a critical gap

The Trendrating system enables active fund managers to improve the performance and control risks. Trends are there all the time, equity markets display an incredible dispersion of performance as showed in the below tables. This is a fantastic opportunity for investors, to capture a large part of the top performers and avoid most of the bottom performers using Trendrating. This allows active managers to outperform passive benchmarks that are just a mathematical combination of both winners and losers.

The dispersion of performance for the 12 months ending on January 1st 2021:

STOXX Europe 600 Performance* S&P 500 Performance*
Index -3.90% Index +16%
Top 25% +61% Top 25% +110%
Bottom 25% -28% Bottom 25% -17%

Trendrating’s unique & innovative trend capture methodology provides investment managers a framework for outperforming their benchmarks and to prove that active management can be smarter than benchmark tracking passive strategies. 

Trendrating edge

Trendrating provides advanced analytics designed to capture trends, identifying most of the winners and avoiding a large part of the losers with in a yearly horizon.

Our model offers a unique rating of trends where A and B indicate a bull trend and C and D mark bear moves. We provide a unique edge where A and B rated stocks on average outperform those rated C and D.

The solution is a powerful complement to the existing analytical process of active equity portfolio managers.

Trendrating Portfolio Sentinel makes possible to improve returns and control risks with an objective, well validated Systematic Trend Quality Assessment Methodology.

  • Profit from our proven rating of price trend.
  • Easily spot emerging risks of trend reversals at security, sector and market level.
  • Use the portfolio sentinel app to maximize the performance of your own strategy.
  • Add intelligent trend capture analytics to strengthen your decision making.
  • Capture the winners and avoid the losers.
  • Simulate portfolio optimization and improve the return/risk profile.
  • Get alerted about trend upgrades and downgrades for every holding.
  • Rate the overall exposure to actual trends, the higher the portfolio rating, the higher the expected returns. A low rating indicates high risks to underperform.

Discretionary Management

Discretionary portfolio management is full of traps and pitfalls.

The challenges

  • Recurrent underperformance
  • Old school risk control
  • Time management
  • Increasing compliance

Recurrent underperformance #1

The problem
  • Many strategies are primarily based on fundamental analysis and old school-traditional data.
  • Poor consideration and respect for actual price trends.
  • This is why 80% of mutual funds underperform the benchmarks (Source: S&P SPIVA)
Trendrating solution
  • Correlation between price action and fundamentals is getting weaker.
  • Several factors generate trends including sentiment and big money flow. As it is impossible to measure all the complexity, investors should focus on the final effect (trends).

See the forest, not the trees.

Recurrent underperformance #2

The problem
  • The traps of human behavior. (Behavioral finance key flaws)
  • The disposition effect – selling winners too early and sitting too long on the losers.
  • Tendency to forecast and overconfidence.
  • Biases and attachments.
Trendrating solution
  • A disciplined systematic well proven methodology to rate trends and identify trend reversals make possible to limit the damage of subjective human behavior and favor some adherence to the golden rule of investment: “let your profit run and cut your losses”

Traditional risk control

The problem
  • A large part of risk management tools are based on the research and the development from academics developed 20 to 30 years ago.
  • Those theories and metrics are helpful, but cannot capture the complexity of today’s market, partly driven by new variables (a faster more reactive big money flow, social media influence
    and more).
Trendrating solution
  • The concept of risk management requires some re-thinking and more sophisticated tools. One thing is the risk of losses and excess volatility, another thing is the risk of underperforming a basic benchmark and losing assets to the benefit of passive product issuers.
  • The intelligent trend capture analytics of Trendrating provides a new dimension of risk management on a broader scope, targeting the ‘risk to underperform’.

Time management

The problem
  • Precious time is spent by portfolio managers in reading analysts reports, opinion pieces and research whose value in delivering alpha is highly questionable.
  • There is a lot of noise that eats time and can generate a confusing picture.
Trendrating solution
  • Trendrating alternative data and advanced analytics can help to filter the noise, save time and stay focused on what is more relevant – what is the real underlying trend for any security in the universe of interest?

Increasing compliance

The problem
  • Compliance requirements are increasing, and portfolio managers must provide evidence of a robust diligence process behind their investment strategies.
  • Totally subjective decisions or the use of a limited arsenal of analytical tools can impact credibility and confidence.
Trendrating solution
  • The more boxes are checked, the better. Investors must profit from the new generation of data and tools available in the market.
  • A variety of metrics including alternative data and advanced analytics must be satisfied in order to have a trustworthy, saleable and performing proposition.

Trendrating data can help to address key problems

Problem: Recurrent underperformance
Solution: Use Trendrating to maximize returns and beat the benchmarks.

Problem: Old school risk control
Solution: Monitor Trendrating upgrades and downgrades for a timely spotting of trend reversals.

Problem: Time management
Solution: Save time, filter out market noise and gain focus on the key performance factor.

Problem: Increasing compliance
Solution: Enrich your arsenal (war chest) of analytics with proven new generation content.

Make Trends Work For You- Short guide to the use of Trendrating Performance Management Platform

Systematic Management

What is systematic management?

The management of equity portfolios can be performed on a discretionary basis, a systematic basis or a combination of both approaches. Systematic portfolio management is gaining traction as it often provides better returns, lower deviation from an expected outcome, improved discipline and control, full transparency and consistency of the rules governing investment decisions and lower costs.

Systematic management can easily fit into most investment strategies (value, growth or contrarian) as the starting point is the universe of stocks that satisfy the defined qualitative or quantitative criteria. These systems are then used to decide the selection and timing of investments.

The underlying models are usually tested across years of history to validate the added value they can generate across different market cycles (bull trends, bear trends, ranging phases, high and low volatility) and across a large number of securities. After the testing phase, a real-life validation is required to confirm the quality of the models.

Why the growth of systematic management?

Some of the best performing hedge funds are purely systematic, and are proven to outperform a number of discretionary peers. Even some of the largest asset managers have recently moved the management of funds into systematic processes.

This trend is accelerating due to the following:

  • A systematic approach seems to be more in tune with the increased complexity of trends in individual stocks that are impacted by a variety of factors such as big money flow, sentiment, social media, which can overwhelm fundamentals.
  • A systematic methodology can avoid some of the usual pitfalls of human judgement and behaviour (the disposition effect, biases, attachment, tendency to forecast) and rather operate following the golden rule of investing – let your profits run and cut the losses.
  • A well tested model offers less deviations from expected outcomes under different market scenarios.
  • A model can save time and money.
  • A systematic approach can offer the opportunity to launch new investment lines and products, or can be used as an overly to the existing strategies.

However, the performance of a systematic strategy over time is only as good as the models used.

How it works?

Trendrating provides a well proven solution to investors interested in systematic management of equity portfolios.

Best practice suggests using models that have been extensively tested across at least 6 different market cycles and on different equity markets and a large statistical sample of securities.

Traditional models must be easy to understand, transparent (with no black box/AI mystery) and actionable.

Trendrating is the key. If your desire is to manage equity portfolios on a fully systematic basis we have the technology for you.

The foundation is our unique “trend capture” model based on pattern recognition.

The Trendrating Strategy Management Solution ticks all the key boxes of robustness:

  • Tested in sample on 20 years of daily data (c.1988-2008) for over 15,000 listed securities on 10 markets.
  • Validated out of sample on 5 years of data (c.2009-2014)
  • Used by our customers since 2014.
  • Built on a sophisticated pattern recognition algorithm with transparent rules.
  • Uses self-adjusting time windows for more accurate results.
  • Generates an easy to use rating methodology where A and B rated stocks tend to outperform those rated C and D.

The Trendrating Strategy Management Solution:

  1. Our proprietary, sophisticated model generates alpha via trend capture.
  2. The software is based on a high-performance engine to leverage the model via building, testing, optimizing and managing an investment strategy.
  3. We also supply data feeds that can be easily ingested by proprietary or third-party software applications.

The offer

If you want to manage equity portfolios on a fully systematic basis, we have the technology for you.

The foundation is our unique “trend capture” model based on pattern recognition. This is part of our software solution and is part of a sophisticated engine that enables:

  • The design, back test and optimization of investment strategies.
  • The implementation, tracking and maintenance of systematic portfolios.

Our ratings model and ranking tool can be used as an overlay to any factor-based strategy, as a way to maximize alpha from any specific investment style.

  • The Trendrating solution is based on a “pattern recognition” algorithm that processes a large volume of data.
  • The algorithm works on a multi-factor analysis and uses a self-adaptive, flexible time window. When the different factors are in synch there is a high probability that a relevant trend is in place. The dynamic time window enables a timely identification of an emerging trend and the multi-factor approach supports an effective filtering of price noise, short term volatility and false moves.
  • Trendrating provides advanced analytics designed to capture trends, identifying most of the winners and avoiding a large part of the losers with in a yearly horizon. Our model offers a unique rating of trends where A and B indicate a bull trend and C and D indicate bear moves. We provide a unique edge where A and B rated stocks on average outperform those rated C and D.

The dispersion of performance

STOXX Europe 600 Performance* S&P 500 Performance*
Index -3.90% Index +16%
Top 25% +61% Top 25% +110%
Bottom 25% -28% Bottom 25% -17%

*12 months ending January 1st, 2021.

Do not waste time.

Contact us and quickly see how our strategy management solution can deliver more value to your business.

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