'Stuff that every investor should know' by Geoffrey Considine is an informative glance at the world of 'Quantext Portfolio Planning' (QPP). Quantext Portfolio Planning is an investment management software developed by Geoffrey Considine of Quantext Inc., who believes it to be a financial software application that investors should know about.
Geofrrey Considine is a financial writer at seekingalpha.com and touts his financial analysis software as helping to improve asset allocations within an investment portfolio for more optimal money management. This article will discuss Considine's portfolio management software in terms of what it does, its validity and performance. Moreover, this article will review what Geoffrey Considine believes every investor should know. (1) in terms of defining Quantext Portfolio Planning and its effectiveness as a risk management software application.
Investing with Considne's 'Quantext'
Quantext Inc., has two portfolio planning software applications, one for retirement planning and one for portfolio planning. These two software packages called Quantext Portfolio Planner (QPP) and Retirement Portfolio Planner (QRP), run between $104-$184 and have detailed outlines that are available through Quantext Inc. for free prior to purchase. It is evident from the software description in the 'Personal Portfolio Management' section of the Considine's software that it is fundamentally centered around risk management. Thus, the software might be most useful as a tool for investors with specific investment and risk criteria.
The Personal Porfolio Management Software information downloads by Quantext illustrate the statistical techniques and models used by the software to assess portfolio asset allocations. Of particular emphasis is what is Considine's adaptation of the 'Monte Carlo simulation' that assess possible portfolio outcomes using 'realistic' numerical portfolio performance inputs such as yield and volatility. This is explained on page 26 of Quantexts PPM user guide available at its website.
When the Quantext software objectives are clearly defined, and accepted statistical and quantitative inputs are entered into the model, the output becomes an investment report that illustrates expected returns for given portfolio allocations, time-lines, risk levels etc. One of the goals of QPP is to minimize risk while maximizing earnings, thereby creating a positive relationships between investment risk and reward.
Quantext validity and performance
An investor only needs to look at the performance of portfolios that properly use QPP to see how well quantitative investing does. The fact of the matter is the market is not 100% quantitative, so quantitative asset management is a tool only and not a solution. Having said that, Considine's Quantext makes use of and relies on determining statistical probability using three well known variables i.e. Standard deviation, beta, and R squared.
Geofrrey Considine is a financial writer at seekingalpha.com and touts his financial analysis software as helping to improve asset allocations within an investment portfolio for more optimal money management. This article will discuss Considine's portfolio management software in terms of what it does, its validity and performance. Moreover, this article will review what Geoffrey Considine believes every investor should know. (1) in terms of defining Quantext Portfolio Planning and its effectiveness as a risk management software application.
Investing with Considne's 'Quantext'
Quantext Inc., has two portfolio planning software applications, one for retirement planning and one for portfolio planning. These two software packages called Quantext Portfolio Planner (QPP) and Retirement Portfolio Planner (QRP), run between $104-$184 and have detailed outlines that are available through Quantext Inc. for free prior to purchase. It is evident from the software description in the 'Personal Portfolio Management' section of the Considine's software that it is fundamentally centered around risk management. Thus, the software might be most useful as a tool for investors with specific investment and risk criteria.
The Personal Porfolio Management Software information downloads by Quantext illustrate the statistical techniques and models used by the software to assess portfolio asset allocations. Of particular emphasis is what is Considine's adaptation of the 'Monte Carlo simulation' that assess possible portfolio outcomes using 'realistic' numerical portfolio performance inputs such as yield and volatility. This is explained on page 26 of Quantexts PPM user guide available at its website.
When the Quantext software objectives are clearly defined, and accepted statistical and quantitative inputs are entered into the model, the output becomes an investment report that illustrates expected returns for given portfolio allocations, time-lines, risk levels etc. One of the goals of QPP is to minimize risk while maximizing earnings, thereby creating a positive relationships between investment risk and reward.
Quantext validity and performance
An investor only needs to look at the performance of portfolios that properly use QPP to see how well quantitative investing does. The fact of the matter is the market is not 100% quantitative, so quantitative asset management is a tool only and not a solution. Having said that, Considine's Quantext makes use of and relies on determining statistical probability using three well known variables i.e. Standard deviation, beta, and R squared.
It also uses what Considine refers to as Monte Carlo Modeling, which uses assumed market volatility trends to assist in forecasting a portfolio's performance. In other words, given a certain range of input variables regarding market performance, QPP measures individual portfolios against such for more optimal yields. Considine explains his methods in the following linked to article about Monte Carlo Simulation. Some of the variables used in Quantext's portfolio planning are the following:
• Probability metrics
• Investment risk calculations
• Beta correlations
• Standard deviation
• Monte Carlo Simulation
• Probability metrics
• Investment risk calculations
• Beta correlations
• Standard deviation
• Monte Carlo Simulation
According to the software validation tests performed by Quantext, a testing of Quantext Portfolio Planner led to a 180 basis point advantage per year over what is described as 'naive diversification'. The benefits of using the software are thus advantageous in the long run and more evident with larger valued portfolios. Quantext software may be particular useful for fund managers, financial advising firms, and financial services companies seeking to enhance and fine tune their bottom lines with competitive performance.
Summary
Investors should also know there are free risk probability calculator(s) and Monte Carlo simulators are available on the internet and other software applications such as with a Microsoft Excel add in. These calculators may be just as helpful as Quantext's software for a fraction of the price or no cost. It is important to realize how valuable risk assessment in investment management actually is. Additionally, some fund managers oversee asset allocations that specifically make use of, and are designed around quantitative investment selections. One such group of funds is appropriately called 'Quant Funds' ,
Quantitative risk assessment tools refine and narrow risk probabilities to fine tune's one portfolio for a more statistically predictable retirement income and/or portfolio performance. This can be helpful if one is looking for this kind of preciseness. However, if the software does not contain realistic inputs that match market trends and volatility, output numbers will be less useful. Thus, knowing which input variables are used in Monte Carlo simulations are just as important as other variables such as time, monthly and annual investment contributions.
Sources:Summary
Investors should also know there are free risk probability calculator(s) and Monte Carlo simulators are available on the internet and other software applications such as with a Microsoft Excel add in. These calculators may be just as helpful as Quantext's software for a fraction of the price or no cost. It is important to realize how valuable risk assessment in investment management actually is. Additionally, some fund managers oversee asset allocations that specifically make use of, and are designed around quantitative investment selections. One such group of funds is appropriately called 'Quant Funds' ,
Quantitative risk assessment tools refine and narrow risk probabilities to fine tune's one portfolio for a more statistically predictable retirement income and/or portfolio performance. This can be helpful if one is looking for this kind of preciseness. However, if the software does not contain realistic inputs that match market trends and volatility, output numbers will be less useful. Thus, knowing which input variables are used in Monte Carlo simulations are just as important as other variables such as time, monthly and annual investment contributions.
1. http://www.quantext.com
2. http://www.amazon.com/review/R28RBY66KQ1GVH
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