In this blog, we explore the efficiency and convenience of pre-built portfolios, offering both customization and time savings for investment advisors. Instead of creating custom portfolios for each client, providing a selection of 3-5 pre-built portfolios can streamline the rebalancing process and deliver tangible benefits to advisors and clients alike.
Rick Gonsalves
Understanding both beta and correlation is crucial for building successful investment portfolios, as these metrics reveal how an investment reacts to changes in the market. While beta measures how much an investment’s returns swing compared to the overall market, correlation shows how closely an investment’s movements follow the market’s direction. Two investments might have the same beta or correlation, but their performance during market downturns can be very different. That’s why it’s important for advisors to analyze these numbers in both rising and falling markets, rather than relying on simple top-line numbers. By looking at how beta and correlation shift in different conditions, advisors can identify strategies that offer growth in strong markets and better protection when times get tough, helping them make better decisions for their clients.
Rick Gonsalves
Building a portfolio with an optimizer takes minutes—and the results often look great on paper. But the real challenge is understanding how that portfolio is likely to behave over time, based on historical data.
Advisors must be able to explain an investment’s “personality” so clients know what to expect in both good markets and bad. A major part of that is volatility risk, commonly shown through standard deviation. But standard deviation only tells part of the story. To fully understand volatility risk, you also need skew and kurtosis. They reveal how returns behave in extreme markets—not just how much they move, but which way, and how often.
Rick Gonsalves
In investing, feelings often lead us in the wrong direction. Greed makes people buy at the top, fear drives them to sell at the bottom, and comfort keeps portfolios stuck in place. That’s why iQUANT.pro follows a belief called Investment Objectivism — the idea that logic, not emotion, should guide every decision. Using a rules-based, data-driven approach, iQUANT filters out the noise and focuses on what’s real. When the market crashed in 2020, many investors panicked and sold, only to miss the rebound. Others chased hype stocks in 2021 and paid the price. These aren’t one-offs — they’re patterns. iQUANT’s discipline-based models aim to avoid those traps and have consistently delivered benchmark-appropriate alpha over time, because in the markets — just like in math — the truth doesn’t bend to feelings.
Rick Gonsalves
iQUANT pre-built portfolios use historical standard deviation as the primary risk measure instead of maximum drawdown or returns due to its higher repeatability. Standard deviation has a 0.9 correlation with future volatility, while maximum drawdown has 0.5 correlation with downside risk. Historical standard deviation explains 85% of future volatility, compared to less than 50% for return-based measures.
Portfolios are Traditional or Dynamic. Traditional portfolios have fixed stock-bond allocations, while Dynamic portfolios adjust based on targeted risk levels. Advisors choose between Target Risk portfolios, which maintain specific risk levels, and S&P 500 Directional portfolios, which track market movements.
Using data-driven models, iQUANT helps advisors manage risk with a time-tested and justified investment process.
Rick Gonsalves
Tired of chasing returns like a dog chasing its tail? Every year, the same pattern repeats—models get abandoned, strategies get swapped, and investors end up buying high and selling low (again). If market timing worked, we’d all be billionaires by now. But instead, the data keeps proving one thing: sticking to a well-constructed allocation beats emotional decision-making every time.
Yet we’ve witnessed advisors jump ship on solid strategies like the Recession 10 model in 2023 or International Titans last year, only to miss out on double-digit gains. So, if you’re looking for a surefire way to underperform, keep switching strategies. Otherwise, stick around—we’re about to break down why staying the course is the only real winning play.