Predictive Equity Analytics: Portfolio Crisis Proofing and Superior Returns
34 Pages Posted: 25 Nov 2020
Date Written: September 3, 2020
Investor’s returns are enhanced by predictive equity analytics ability to avoid drawdowns and capture gains in bull or bear markets. Predictive equity analytics enables optimal stock selection, timing and bid price with accuracy and reliability. Portfolio value behavior over time is positive and generally a non-decreasing step function. Next trade day predictive equity filtering significantly reduces left tail risk enabling positive returns with high probability. Hedging (crisis proofing) of equity portfolios is a natural artifact of predictive equity analytics with no additional cost and no additional financial instruments required. Portfolios are dynamically constructed using dynamic diversification with higher Sharpe ratios and maximal investment efficiency. Predictive equity analytics enables mean-variance return dominance.
Keywords: predictive equity analytics, machine learning, portfolio hedging
JEL Classification: C22, C32, C48, C53, C58, G11, G12, G19
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