RoobeeFin’s work structure: 5 steps to creating an optimal portfolio 🖐 (part 3)
We continue our series of posts about RoobeeFin’s automatic helper, which will be used on our platform to build portfolios based on user requests.
In previous chapters we have talked about how investment products will be selected, explained user profiling, and how the user’s requests are going to be processed. Moreover, we have discussed how the user’s preferable investment mode will be selected 📝
If you missed those articles, you can read them here:
Today we will talk about how we will implement such portfolio and strategy development, that will be most appropriate to the user’s unique investment purpose.
As it was said earlier, creation of a portfolio or a strategy for the user will be performed on the basis of his psychological peculiarities, investment mode choice and the data he has indicated earlier 👌
At the final stage and before the user will make payment on a platform, the system will give a result — a portfolio or an investment mode which should satisfy user’s personal needs at most.
Let’s have a closer look at the algorithm of the user portfolio generation with the “Smart Investment” mode 📱
First of all, to form the user’s investment portfolio, we use data that he has specified earlier, for example:
➖ Risk profile information;
➖ Expected investment timeframe;
➖ The types of assets for investment selected by the user and their interest in certain industries.
Based on this 👆 we initially select an array of asset classes and products within them that meet the request requirements.
➖ Asset classes.
The classes are selected based on the relevance to the user’s risk profile and his investment timeframe 🙌
➖ Investment products.
Investment products selected according to the relevance to the user’s risk profile and product profitability level
After that, the approximate ratio of asset classes within the portfolio is apportioned, according to their risk level ⚖️
For example, bonds are much less risky than stocks, and stocks are much more secure than cryptocurrencies.
Afterwards, a portfolio is compiled from the selected array of products, using mean-variance optimization via Sharp ratio — to build aggressive portfolios, information criterion — to build conservative portfolios, and minimal volatility — for crypto assets 💼
By distributing investments with Roobee, users will minimize their risks and increase the potential return.
For more experienced investors, Roobee will provide the opportunity to create a unique investment portfolio independently.
