Asset Managers
Axona augments your skills and experience by taking your market views and calculating the best set of portfolios that meet your objectives within the constraints that you set.
Asset Managers require complex portfolios with many different and complex constraints. These portfolios also generally have many assets. Asset Managers also have access to valuable input data and house views that can be incorporated into the model.
The Axona optimiser can be used for all types of mandates, including Multi Asset, Equity , Fixed Income , Property and Money Market. The optimiser can be used for Absolute or relative funds.
Benchmarks are an important component to Asset Managers, and these benchmark portfolios can be evaluated alongside the proposed portfolio.
Benefits
Asset Selection
Axona assists with asset selection by displaying various asset statistics and analytics, as well as correlations.
Compare Portfolio vs Benchmark
Portfolio performance is compared against various benchmarks or other portfolios.
Easily express your forecasts
Forecasts may be expressed per asset, based on expected mean, low, and high.
Portfolio optimization is a crucial task for any asset manager. It involves the process of selecting and allocating the right mix of assets to achieve the desired financial goals and risk management objectives. The primary objective of portfolio optimization is to maximize returns while minimizing the associated risks. Achieving this objective requires a comprehensive understanding of the market conditions, investment goals, and the available investment options.
Asset managers have access to various tools and techniques to optimize their portfolios. One such tool is modern portfolio theory (MPT), which was introduced by Harry Markowitz in 1952. MPT is based on the principle that investors can reduce their portfolio risks by diversifying their investments across different asset classes. By diversifying across asset classes, investors can reduce the risk associated with any individual security or asset class.
Asset managers use various quantitative tools to optimize their portfolios. These tools include statistical models, optimization algorithms, and risk management techniques. These tools help asset managers to identify the optimal portfolio allocation that maximizes returns while minimizing risks.
The process of portfolio optimization involves several steps. First, the asset manager needs to identify the investment objectives and constraints of the portfolio. This includes factors such as the risk tolerance of the investor, time horizon, liquidity requirements, tax considerations, and regulatory constraints. Next, the asset manager needs to identify and evaluate the available investment options. This involves conducting rigorous research and analysis to determine the expected returns, risks, and correlations of different assets. The asset manager then constructs an efficient frontier that identifies the optimal portfolio allocation that maximizes returns for a given level of risk. Finally, the asset manager needs to continuously monitor and rebalance the portfolio to ensure that it remains aligned with the investment objectives and market conditions. This involves periodic reviews of the portfolio’s performance, making adjustments as needed, and ensuring that the portfolio remains diversified.
In conclusion, portfolio optimization is a critical task for any asset manager. It involves a comprehensive understanding of market conditions, investment goals, and available investment options. Asset managers use various quantitative tools to optimize their portfolios and identify the optimal portfolio allocation that maximizes returns while minimizing risks. By following a disciplined and rigorous process, asset managers can build well-diversified portfolios that deliver consistent returns over the long term.