Our Investment Solutions

We build portfolios for investors based on their risk profile and return objectives. We combine financial technology and quantitative finance within an institutional, systematic investment process in order to maximize risk adjusted returns and massively compress costs. We disrupt and outperform traditional Private Banks and Asset managers’ portfolios of similar asset class allocation.

Partner testimonial: David Friedland, CEO of Interactive Brokers Asia says:

“SystematicEdge, a regulated financial advisor using our execution platform for Direct Market Access, aims to provide Professional Investors and High Net Worth Individuals with efficient and sophisticated systematic investment strategies across asset-classes, regions and themes."

We use technology to maximize performance and drastically compress costs  

To achieve this, the following principles underpin all of our portfolios:

• Systematic Investment Process: All our portfolios are rules based in order to systematically accumulate asset income and capital gains.
• Direct Market Access (DMA): We use DMA on the world’s regulated exchanges, such as Globex, in order to access institutional level financial instruments at the best price with no counterparty risk and no valuation uncertainty.  Read more about this in our thought piece.
• Bypass all intermediaries to massively compress costs. We do not use banks or financial intermediaries.

Our Mission

We manage high performance liquid portfolios with the objective of capital preservation

• Clear performance objectives within a defined risk mandate
• Safety
• Transparency 

Our Customized Solutions are based on these flagship portfolios:

Global Fixed Income and Equity Allocation

Combining equity and fixed income investments is an effective way to improve risk-adjusted returns in a portfolio thanks to diversification. The 60/40 allocation rule allows the Portfolio to benefit from both stocks’ dynamic performance and bonds’ steadier returns.

GLOBAL EQUITY: 60% - The Equity portion of the Portfolio accumulates income from dividends and provides exposure to Global Equity markets. It is diversified in terms of regional exposure. The Portfolio invests in Equity Index Futures, which are efficient instruments to gain precise sectorial and regional equity exposure, optimize dividend income and financing rates, and generate extra income from repo rates.

GLOBAL FIXED INCOME: 40% - The Fixed Income portion of the Portfolio takes advantage of the new paradigm of modern monetary policy applied by central banks, which provide controlled refinancing rates to financial institutions, corporations, and governments in order to minimize default events. The Portfolio invests in bonds that benefit the most from this controlled interest rates environment, especially dated maturity bonds (not perpetual bonds, nor preferred shares) from Investment Grade financial institutions, short-term High Yield corporate bonds, and government bonds. Most of these bonds are only available to Professional Investors, with large minimum investment sizes, which makes their yield attractive compared to other bonds with similar credit risk. The Forex risk is hedged in the Portfolio’s base currency.

Systematic Investment Process

By using a “60% Equity / 40% Fixed Income” targeted asset-class allocation, the Portfolio tends to buy securities when they decrease in price and sell securities when they increase in price at every monthly rebalancing, corresponding to a “buy low, sell high” strategy. For each asset class, our systematic investment process optimizes the allocation within a predefined investment universe in order to achieve the Portfolio’s target regional and sectorial exposures. The Portfolio is built so that bond positions are not decreased during rebalancings. This is achieved through the dynamic use of low leverage within the [ x1.0 - x1.1 ] range.

Fixed Income Market Opportunity:                                  

The portfolio allocation takes advantage of the new paradigm of modern monetary policy applied by central banks that provide controlled refinancing rates to the financial institutions, corporations and governments in order to minimize default events. The portfolio’s components are bonds that are benefiting the most from this controlled interest rates era, especially dated maturity bonds (not perpetual bonds nor preferred shares) from investment grade banks. Most of these bonds are only available to professional fixed income investment managers, with large minimum investment sizes (e.g. US$100k~200k), which makes their yield attractive compared to other bonds with similar credit risk. 

Income Generation Mechanism: 

The Bond Income Portfolio accumulates income from bonds with compelling value and yield. From the cash proceeds, it generates regular income regardless of market conditions. The cash income is systematically reinvested in order to maximize the compounded returns of the portfolio. The risk adjusted income objective is calibrated to deliver an average net yield of 6% to the investor.

Global Equity Exposure

The Portfolio accumulates income from dividends, provides exposure to Global Equity markets and is diversified in terms of regional exposure. 

The Portfolio invests in Equity Index Futures, which are efficient instruments to gain precise sectorial and regional equity exposure, optimize dividend income and financing rates, and generate extra income from repo rates.

Cash Optimization 

The Portfolio’s cash is optimized by investing in money markets and dated maturity bonds (not perpetual bonds, nor preferred shares) from Investment Grade banking institutions. Buying bank bonds gives investors more compelling yields than simple cash deposits at the bank. The Portfolio’s target bank bond exposure may reach up to 25%. 

Thematic Portfolios

We use our flagship portfolios as building blocks and integrate themes, sectors, and regional allocations to match the investment mandate.  Contact us for more information on our exciting thematic offering.