Find out how to transform a traditionally managed equity portfolio into an efficient enhanced index strategy with an ESG filter – and seize the opportunity for greater efficiency, sustainability and performance.
The challenge – a case study
An institutional investor wants to transform a traditionally managed equity portfolio into a benchmark-oriented solution with a low tracking error. Additionally, he wants to incorporate ESG criteria so that his investment meets the requirements for sustainable investment.
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The Quoniam approach: Listen – and ask the right questions
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How do we achieve at least the benchmark performance after costs? -
How do we stay within our tracking error budget?
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How do we achieve the broadest possible diversification?
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What sustainability approach should we take when building our portfolio?
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The way forward
To help our investors achieve their objectives, we have developed a systematic enhanced index strategy with a sustainability filter.
First, we analyse the selection universe (the benchmark): In principle, we can evaluate all stocks worldwide and we also know their sustainability data.
Together we define a tracking error, which we use as a risk budget to implement the exclusion criteria and to create excess return potential. The chance of outperformance increases with the level of the tracking error granted.
Our unique data and trading ecosystem allows us to select the most appropriate economic and environmental metrics and optimise the portfolio under constraints to achieve the highest possible diversification. Our proven strength in multi-factor strategies allows us to identify and reduce undesirable correlations in real time, whilst taking actual market liquidity into account.
Our efficient processes from data analysis to transaction execution, allow us to offer investors an enhanced index strategy that still provides the opportunity to outperform the benchmark after costs and can be classified under Article 8 of the Disclosure Regulation.
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Your customised solution
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All mandate strategies are 100% customisable -
A truly global investment universe – can only be analysed with a systematic approach
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Currencies – in the benchmark currency of your choice, optionally in US dollars or with exchange rate hedging (euro hedged)
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Smart integration of ESG data
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Three pillars of screening, integration and engagement
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Customisation of the data for your portfolio
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Detailed reporting in line with the Disclosure Regulation
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Curious to know more?
Not only can we prove the effectiveness of our strategy, we can repeat it! Contact us and we will analyse, without obligation, which strategy and parameters best suit your needs – and what potential returns you can achieve.
Interested?
Get in touch with me.
We would be happy to talk to you about your investment goals and their implementation. Contact me and we will analyse, without obligation, which strategy is the most suitable for you.
Contact
Jorre Willemse
