On Balance – Original thinking, essential insight.
Libra Investment Services has spent the last twelve years operating as a research and advisory business to equity market investors worldwide. At the heart of our approach is the idea that equity markets are not a complicated problem to simplify and solve but instead are an open, complex adaptive system to be analysed and understood as much as we can; regardless of their current state of uncertainty or unpredictability.
The dynamic nature of financial markets and the information sets that they respond to every day requires expectations, risks and uncertainties that surround asset prices to be reviewed and our understanding of them updated (and hopefully improved) on a regular basis. Any changes that lead to adjustments in valuation and related issues of risk and return need to be factored into portfolio analytics on a timely basis and communicated in a manner that can be easily integrated into investment decisions.
This is why we have constructed a comprehensive, bottom-up, integrated risk and expected return analysis system based upon Apollo; our proprietary stock-level Asset-pricing model. To help gain insight and improve our understanding of the complex system of global equity markets, we have developed a series of adaptive factor-related signals and forecasts that not only evolve through time as we analyse stock level information dynamics daily but, due to the systematic methodology underpinning all the Apollo models, work equally effectively at the aggregated level: sectors, markets, ETFs, or custom portfolios can all be analysed in the same manner as an individual share.
Given the daily updating nature of the Apollo system, we seek to be always timely and relevant in ever-changing markets; insight that we now seek to bring to a wider audience. The type of written and visual content we are able to produce is not only insightful in terms of stock-level analysis but, in allowing a top-down view to be built from the bottom up provides a continuous framework of analysis not available elsewhere. On Balance is the new financial markets blog by the team at Libra that seeks to share those views and insights with our readership.