Digital Advisor
Cross-platform solution for investors who wish to automatically manage their portfolios by using a pre-defined model that quarterly
Introduction
In addition to the full-fledged trading terminal available for professional traders, Autoshares Trader also comes with a lightweight digital advisor that enables automatic rebalancing of portfolios in accordance with a pre-defined model that determines:
Which asset classes should comprise the portfolio
The weight of every asset class in the portfolio.
Each model has its own theme and the target audience: for example, there can be aggressive models for aggressive investors, conservative models for low-risk investors. With respect to industries, there might be models weighted towards renewable energy companies, high-tech companies, or space exploration companies. And in similar fashion many different models can be created and tailored to investors' preferences and risk tolerance.
Each model is defined by the broker before their instance of Digital Advisor is deployed in production. Here is how it works: the broker opens a special administrator widget where they can create a new model, give it a name, and then specify securities that this model should have along with their corresponding weight in the portfolio (which should collectively add up to 100%). Once a new model is created and fully defined, it'll immediately become available in the list of all models from which investors can choose upon registration.
Investors do not have to actively manage their portfolios: they simply sign up, select a model, deposit funds, and then proceed to track their portfolio returns. The Digital Advisor will automatically rebalance the portfolio based on the model once in a time period: overweight securities will be sold to fit their quota in the portfolio, and underweight securities will be purchased to increase their quota in the portfolio. At the end of the rebalancing, the weight of each security in the portfolio will reflect its value in the model.
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