Investment Tools

Portfolio Analysis

Portfolio Analysis is a process in which your credit union’s investment portfolio is examined for performance value and potential. The information garnered from regular, comprehensive analysis is used to guide a future course. Routine analysis helps your credit union not only determine areas of concern before they become complicated problems, but it also helps you pinpoint areas of success so you can take timely advantage of opportunities. 

Routine, comprehensive portfolio analysis helps you:

• Deliver more A+ performances more often
• Pinpoint areas of untapped earnings potential
• Avoid unnecessary risk exposure

Credit unions often build investment portfolios independent of the balance sheet, acquiring investments as dealers make them available. Reviewing the entire portfolio’s performance on a scheduled basis prevents leaders from jumping on investments that may look like opportunities, but in truth, may throw off asset/liability balance, create unnecessary risk exposure, and steer the credit union away from its goals. When investment managers understand how every component of the portfolio has performed and is performing, from both a capital at risk and an expected return point of view, investment decisions are more likely to enhance performance. 

Portfolio analysis helps credit union managers and asset liability committee members make more informed and more goal-aligned balance sheet liquidity/risk management decisions. It helps credit union CEOs and CFOs determine if the credit union is on track to achieve its performance benchmarks. It allows leaders to pinpoint areas that have performed well and not so well, shedding light on what is working and what is not. Regularly scheduled portfolio analyses by highly trained investment and risk experts are key to ensuring performance success. 

Portfolio Optimizer

The Portfolio Optimizer is a sophisticated analytical tool developed by QuantyPhi’s balance sheet optimization experts to help credit unions make informed investment decisions. It combines QuantyPhi’s two pillars of portfolio management with advanced analytical functionality to automate your investment decision making process. 

QuantyPhi’s two pillars of sound investment portfolio management are:

• Benchmarking philosophy
• Focus on total return

Key Benefits

QuantyPhi's Portfolio Optimizer simplifies investment decision-making, helping you select the ideal mix of securities based on your benchmark and available funds. It allows you to see, in real time, how a mix of potential investments will influence your portfolio's total return. By mathematically allocating available funds, it identifies investments that provide the optimal combination of risk and return to align with your credit union’s investment goals. Most importantly, the Portfolio Optimizer helps you maximize investment returns while adhering to acceptable risk levels as prescribed by your benchmark. 

Read Our Benchmarking Whitepaper

How does the Portfolio Optimizer Work?

QuantyPhi can perform a benchmarking study to determine the ideal benchmark for your credit union’s investment portfolio based on your unique balance sheet composition, investment goals, risk limits, and current market interest rates. Then, QuantyPhi’s team of investment experts will identify a population of securities specifically to fit your credit union’s investment policies and objectives that will help you align with your benchmark. Finally, using the Portfolio Optimizer, QuantyPhi can instantly show you the ideal way to allocate your available investment dollars in the most efficient manner to reach your benchmark goals.

The Portfolio Optimizer utilizes a Generalized Reduced Gradient (GRG) nonlinear solver algorithm to derive the ideal available funds allocation to optimize to the benchmark. It is a slope and derivative based algorithm that rapidly narrows potential solutions until an optimum solution is reached.

View an example of the tool below. The first image explains the various features and areas of focus for the Portfolio Optimizer and the second image details the results after the tool has run.

Click each image to enlarge.

*Securities offered through Concourse Financial Group Securities, Inc. (CFGS), Member FINRA/SIPC. Advisory services offered through Concourse Financial Group Advisors, a DBA for CFGS, a Registered Investment Advisor. QuantyPhi, LLC. is independent of CFGS.

**Securities offered through Concourse Financial Group Securities, Inc. (CFGS), Member FINRA/SIPC. QuantyPhi, LLC. is independent of CFGS. Check the background of your financial professional on FINRA’s BrokerCheck.

***For a copy of CFGS’s Form CRS please visit: ConcourseFinancial.com.