The Strategy

Manage Strategy

The main feature of Strategies in Manage is to organize your holdings depending on the strategies used.  Whereas your brokerage account looks like a single blob of stocks, Portfolio123's Accounts can track the performance of multiple strategies.


Strategies possess some interesting features:

  • Strategies can either follow a model (see below) or be manual.

  • Strategies do not hold any cash. They are assigned stock transactions from the Account, and therefore only hold positions. This also means they are always 100% invested.

  • Even though they hold no cash, dividends earned by the positions are included in the stated returns.

  • Strategies can be deleted and recreated by transferring transactions.

  • Strategies can be rebalanced, bought or sold with single clicks.

Whilst some of these features may seem a bit strange at first, Strategies should feel very natural once you start using them.


Model Choices

The choices for what the Strategies follows are:

  1. Portfolio123 Model - These are rules-based models created by Portfolio123's investment team. There are several families of models depending on your risk appetite and goals.

  2. Designer Model - These are automated strategies designed by skilled users of Portfolio123's Research tools. 

  3. Research Model - A Model from your Research section. 

  4. Manual - Choose this when you are not following any model or are tracking a model external to Portfolio123. 

You can change the Model being followed by a Strategy at any time. Simply click on "Unfollow Model" to convert the Strategy into a Manual one, then click "Follow A Model" to pick a new Model.


Rebalancing 

For Strategies that follow Models you will get a "Rebalance" warning when they are not in sync with the underlying Model. Rebalancing is a single-click operation the shows all the necessary transactions to return the model to syncing (within the tolerance allowed).

Rebalancing a Strategy is optional; it is simply a warning. You can choose to ignore the alert, but the Rebalance button will remain present. You can also stray considerably from a model by adding your own transactions. This may be desirable, for example, at the end of the year for tax purposes. 


Figure 1. Sample of a strategy the is following a model.