The service comprises a financial trading platform that utilizes an innovative
algorithm to outperform the market in the medium-long term. The system
merges the trading algorithm with complex financial data-mining techniques and a
real time trading interface allowing the client to achieve
high yields with little interaction with the system.
For those looking for more hands on approach our
system allows to customize
the trading preferences that affect the algorithms behavior. Institutional clients
will be allowed an even greater degree of customization, tailored to meet their risk
preferences, duration of investment and branch exposure to the market. The leading
concept incorporated in the trading algorithm is Valuation. The statistical component
of the trading algorithm is used to derive the valuation of each share in the market.
The calculation of this valuation is one of the main financial innovations implemented
in this service. The system calculates company’s under-valuation e.g. the percentage gap between
the share price in the market and the share's value as determined
by the system. Valuation is calculated using statistical algorithm which utilizes
several information sets:
- 1. Financial performance of the company.
- 2. Financial performance of other companies in the same sector.
- 3. Overall performance of the market.
- 4. Macro economic conditions.
- 5. Prices of relevant commodities.
The system ranks the shares according to their undervaluation and recommends purchasing
the most under-valued share, subject to predefined constraints to reduce overall risk.
Based on the undervaluation of each stock we determine
the composition of the optimal portfolio.
Investment Strategies
Our service allows the investor to choose one of three strategies (three generic and one mixed):
- 1. Long only - all of the portfolio is invested in long positions.
- 2. Market Neutral - 50% long positions and 50% short positions.
- 3. Short only – for the ‘bear’ investors only.
- 4. Mixed strategy - composition of two former strategies in given percentage.
For example, semi-bullish strategy can be achieved with mix of 50% of long only
strategy and 50% of market neutral. Overall exposure of this strategy will be 75
long and 25 short.
Whichever strategy is chosen additional safeguard parameters are added to optimize
portfolio performance and minimize the risk. Additional sets of parameters make sure
there is sufficient diversification in the portfolio between different sectors.