Registered Investment Advisors
Serving Advisors, Aggregators, Wealth Managers, Asset Managers, and Hedge Funds.
How a RIA Launched a Multi-Factor Portfolio in 2 Months with STRATxAI
Client Profile
A US-based investment firm specializing in managed futures, serving a diverse client base of individual and institutional investors, including pooled investment vehicles. As part of a strategic growth plan, the firm set out at the start of 2024 to broaden its offering to include equities.
Challenges
The RIA faced several key challenges in launching quantitative equity strategies, including:
Expertise Gap: Despite its expertise in futures trading, the firm lacked in-house quantitative equity expertise needed to design and manage sophisticated equity portfolios.
Resource Constraints: Developing in-house capabilities posed significant financial and time-related barriers, making an outsourced cost-effective solution necessary.
Strategic Alignment: Finding a partner capable of delivering alpha-driven equity portfolios that aligned with its core philosophy proved challenging.
Our Solution
STRATxAI collaborated with the client to co-create a bespoke portfolio solution. Key steps included:
Client Discovery: Gained a deep understanding of the client’s investment objectives, including their focus on long-term performance and alpha generation.
Strategy Development: Leveraged our proprietary investment engine to develop a range of multi-factor equity portfolios tailored to their specific requirements.
Strategy Refinement: Engaged in an iterative co-creation process to refine and identify the optimal strategy that aligned with the client’s goals and philosophy.
Client Outcomes
Despite the lack of in-house expertise, our client launched a bespoke multi-factor US equity portfolio in June 2024, within 2 months of partnering with STRATxAI.
Key Results Since Portfolio Inception:
- Outperformed the S&P 500 Index by 11.0%.
- Beta of 0.8 to the S&P 500 / 0.4 to the Nasdaq 100.
- Strong client traction, reinforcing confidence in expanding their offering.
