After a client or prospect completes a risk assessment, TIFIN Wealth's portfolio optimizer will recommend the best fit model, pulling from your Active Model Universe, to place your investor in a tailored recommendation that falls within their Risk Band.
Portfolio Optimizer
TIFIN utilizes investment algorithms to recommend the optimal client portfolio by automatically selecting investment models with the maximum expected forward return while falling within a client’s “Risk Band”.
How does the optimizer choose the “best” model?
The optimizer takes into account the Risk Capacity and Risk Preference scores as determined by the outcome of the client’s Risk Assessment questionnaire.
If the individual’s Risk Capacity is greater than the Risk Preference:
The optimizer will find all portfolios that fall within the Risk Band and select the one with the highest expected return.
If the individual’s Risk Capacity is less than the Risk Preference:
Recommend the portfolio with a Risk Score closest to the Risk Capacity but still within the Risk Band. If there are multiple portfolios that meet this criterion, the optimizer will select the model with the higher expected returns.
The Portfolio Optimizer also analyzes an advisor’s book-of-business to flag clients/prospects outside of their Risk Band to assist in ensuring compliance:
Manually Swap a Recommended Model
If an advisor wants to change the model that TIFIN Wealth suggests, click into the Swap Model icon on the model card:
Toggle on the filter to narrow Active Models to those that fall within the client or prospect's Risk Band:
