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Portfolio recommendations overview
Investment recommendations will only be considered if they are defined to be in scope. For each portfolio recommendation that is generated, the fees and risk/return assumptions associated with that portfolio will be attached to the cashflow modelling assumptions. These assumptions will be applied to the
Portfolio recommendations can be generated across the following products/entities:
-Superannuation (including pension phase).
-Wrap/Mastertrust accounts
-Investment bond accounts
-Self Managed Superannuation funds (recommendations are available per account within the fund)
-Personal tax entity
-Trust entity
-Companies
Generating portfolio recommendations
Advisers have one of 2 options when generating a portfolio recommendation:
1: Model portfolio
If model portfolio is set, then the investment recommendations will be set based on the preferred portfolio as defined by the advice group.
2: Optimise a portfolio
PrimeSolve’s optimisation algorithm comes with a range of inbuilt optimisation methods including:
| Optimisation method | Overview |
|---|---|
| Minimum fee | Finds the portfolio that minimises the expected fee whilst obeying the specified constraints. (Refer to portfolio constraints) |
| Maximum score | Finds the portfolio that has the highest rated score based on external ratings agencies. |
| *Factor based | Rates stocks on rank assets across your recommended product list taking into consideration the return factors which have historically demonstrated excess market returns over the long run. The factors covered are: momentum, size, yield, quality, value. |
| Mean varaince | Finds the portfolio that has the minimum expected volatility for a given return expectation. |
| Black Litterman | Allows you to insert your own in-house bias or expectations into a model. We then re-optimise factoring in those assumptions. |
For more information on portfolio optimisation refer to the PrimeSolve technical guide.
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