Book a Demo

Year: 2023

Categories
News

Fundamentum drives fixed income AUM growth with bondIT Orion Integration

Fundamentum uses bondIT’s investment technology integrated with Orion to scale growth in its fixed income business

NEW YORK, NY, February 22, 2023 – bondIT, a leading provider of next-generation investment technology, announced today that Fundamentum Investment Management has begun using bondIT’s portfolio optimization and credit research solution integrated with Orion’s advisor technology platform.

Fundamentum was looking for technology to help them efficiently scale their fixed income business and optimize risk-return outcomes. They selected bondIT’s Frontier portfolio construction technology to position client portfolios systematically on the efficient frontier and later incorporated bondIT’s Scorable AI-based credit research solution to enable credit-aware portfolio construction and rebalancing.

Using Scorable and Frontier together has allowed Fundamentum to systematically reduce exposure to deteriorating credits while substituting higher-quality bonds with equal or better yield. The final piece of the puzzle for efficiency and scale gains was Fundamentum’s integration of bondIT’s technology with the Orion platform.

Fundamentum’s Robert Armagno, CFA, said, “Using bondIT integrated with Orion has allowed us to move our fixed income portfolio management to levels we couldn’t reach without this technology. We can generate and rebalance proposals in seconds while adhering to the objectives and constraints that advisors and their clients have formulated. bondIT is a proposal generation machine for us, and a huge competitive advantage when it comes to managing and growing our fixed income business.”

Dan Taylor, Head of Americas at bondIT, said, “We’re delighted that Fundamentum has opted for bondIT’s technology to help them expand their fixed income business and attract new clients. Our platform enables Fundamentum to automate crucial parts of their portfolio management and research process, improving efficiency, performance and scale.“

Frontier is bondIT’s cutting-edge portfolio construction and management platform that helps investment professionals make data-driven decisions and streamline their workflows. It allows users to generate and rebalance portfolios based on different optimization criteria, individually configurable portfolio objectives and bond level constraints within minutes.

Scorable is bondIT’s innovative technology for evaluating and projecting credit rating changes in fixed income securities. It utilizes machine learning algorithms to analyze a wide range of data points and provides actionable insights.

Mr. Armagno adds, “Frontier has been a game changer for our team. It has significantly improved our ability to analyze and construct portfolios and has saved us a tremendous amount of time. Scorable has revolutionized the way we approach credit and relative value analysis. It’s a consistent and reliable framework and has enhanced our ability to identify risk as well as attractive investment opportunities.”

– Ends –

 

About Fundamentum Investment Management

Fundamentum, an SEC registered investment adviser, provides portfolio management services for wrap fee programs sponsored by its affiliated registered investment advisers within the Stratos Wealth Holdings family of companies, which includes Stratos Wealth Partners and Stratos Wealth Advisors. Fundamentum is based in Beachwood, Ohio and provides disciplined investment strategies tailored to clients’ risk tolerance and objectives. As Fundamentum’s team helps manage portfolios alongside over 350 Advisors, tools that can help create efficiency and scale are critical.

Stratos Wealth Partners, Ltd., an SEC Registered Investment Advisor, manages over $8.7 billion in advisory assets, and advises through LPL Financial, over $6.7 billion in brokerage and third-party managed assets for a total of $15.4 billion as of September 30, 2022.

Fundamentum, LLC, an SEC Registered Investment Advisor, manages over $1 billion in advisory assets as of September 30, 2022.

Stratos Wealth Advisors, LLC, an SEC Registered Investment Advisor, manages over $2.4 billion in advisory assets and over $13 million in third party managed assets as of September 30, 2022.

Stratos Wealth Management DBA LPL Financial, an SEC Registered Investment Advisor, manages over $270 million in advisory assets, and advises through LPL Financial, over $287 million in brokerage and third-party managed assets for a total of $557 million as of September 30, 2022.

 

About bondIT

bondIT provides next generation front office investment technology. We combine Data Science, Explainable-AI (XAI) and Advanced Technologies with Fixed Income investment know-how to improve the performance, accuracy and efficiency of our clients’ investment processes and businesses. bondIT is privately owned and paving the way for financial institutions of all sizes to integrate the power of greater technology in their investment processes. bondIT adheres to the highest privacy and security standards and is SOC 2 certified by Ernst & Young. For more information, please visit bonditglobal.com and follow us on LinkedIn.

 

Nothing within this press release should be relied upon as investment advice, and nothing within shall confer rights or remedies upon, you or any of your employees, creditors, holders of securities or other equity holders or any other person. bondIT expressly disclaims all representations and warranties, express, implied, statutory or otherwise.

Categories
Blog News

Scorable AI Credit Risk Outlook 2023: Rising Stars to outnumber Falling Angels

Scorable, bondIT’s AI-driven Credit Analytics, indicates a sizeable amount of rating migrations for corporate and financial issuers in 2023 with Rising Stars set to outnumber Falling Angels. This is good news for investors who can catch rating upgrades early on as they can benefit from higher yields and price appreciation.  

As high market volatility persists though, investors need to be selective. Many companies had to clean up their balance sheets driven by the fallout from the Covid-19 pandemic and therefore enter the year from a position of relative strength, but the macro-outlook remains challenging. Anticipating directional credit changes early helps to effectively manage risk, discover new investment opportunities, and build portfolios that optimally balance risks and returns. 

Our latest analysis indicates that 45.7% of the nearly 200 BB+ rated issuers in the Scorable universe have a high or very high rating upgrade probability in the next 12 months, with most Rising Stars to occur in Europe and the US. 

Credit Risk across Regions: Around half of BB+ Issuers in Europe and the US could become Rising Stars in 2023 

 

The risk of Falling Angels is highest in Emerging Markets* where 20% of BBB- rated issuers display a high or very high downgrade probability. Across the globe, 11.8% of BBB- issuers in the Scorable universe are at risk of becoming Falling Angels within the next 12 months. 

Credit Risk across Regions: Risk of Falling Angels highest in Emerging Markets in 2023 

Scorable, bondIT’s credit analytics platform, harnesses machine learning and explainable-AI to predict downgrade and upgrade probability of nearly 3,000 rated corporate and financial issuers worldwide within a 12-month timeframe. The Rating Transition Model analyses more than 250 data variables daily including solvency ratios, capital requirements, profitability, and efficiency ratios. 

Want to find out which companies are most likely to become Rising Stars or Falling Angels? Log into Scorable now or contact our team for more info.
 

*Emerging Markets include Mexico, Brazil, Argentina, South Africa, Poland, Turkey, India, Indonesia, China, and South Korea. 

Categories
Blog

Harnessing the Power of AI for Sustainable Fixed Income Investments

In the fast-paced world of finance, staying one step ahead is key. Traditional fixed-income investment strategies have been around for a while, offering a safer alternative to the wild rollercoaster ride of equity markets.

But in the face of fluctuating interest rates, geopolitical uncertainties, and fluctuating economic conditions, the old ways may not always cut it. Enter the AI-driven platform for sustainable fixed-income investment strategies—this revolutionary approach harnesses the power of artificial intelligence to provide insightful data analysis, predictive modeling, and risk management, offering a fresh and dynamic way to navigate the fixed-income market.

Now, before you start visualizing some terminator-like machine taking over the financial world, let’s clear the air. We’re talking about sophisticated algorithms and machine learning techniques that can churn out valuable insights and make sense of vast amounts of data in a way that humans simply can’t. These tools can help identify patterns, anticipate market changes, and make informed investment decisions. It’s about working smarter, not harder, in the pursuit of sustainable financial growth.

The beauty of AI-driven strategies is that they’re not one-size-fits-all. They can be customized based on individual needs and risk tolerance levels. So, whether you’re a seasoned investor looking to diversify your portfolio, or a newbie just starting on your investment journey, there’s something in it for you.

The Future of Sustainable Investing: AI-Driven Fixed Income Strategies

  1. The Significance of Integrating ESG Criteria into Fixed Income Investments

As concerns about climate change, social inequality, and corporate governance grow, investors are increasingly looking for investment opportunities that align with their values. Incorporating ESG criteria into fixed-income investment strategies allows investors to:

  • Align investments with values: By selecting bonds issued by companies and governments with strong ESG credentials, investors can be confident that their investments are contributing to a more sustainable, equitable, and well-governed world.
  • Manage risk: Companies and governments with robust ESG practices are typically considered less risky than their counterparts with weak ESG performance, as they may face lower regulatory, reputational, and financial risks.
  • Enhance long-term performance: Numerous studies have shown that companies with high ESG scores tend to deliver better long-term financial performance, suggesting that sustainable fixed-income investing can unlock opportunities for superior risk-adjusted returns.
  1. Navigating the Challenges of Sustainable Fixed Income Investing

Despite the advantages of integrating ESG criteria into fixed-income investment strategies, investors face several challenges, including:

  • Data availability and quality: Access to comprehensive, reliable, and up-to-date ESG data is essential for assessing the sustainability credentials of bond issuers and making informed investment decisions.
  • ESG scoring inconsistencies: ESG rating methodologies and definitions can vary across different providers, leading to inconsistencies in scoring and potential confusion for investors.
  • Incorporating ESG factors into traditional credit analysis: Effectively integrating ESG factors into the process of credit risk assessment requires specialized knowledge and tools tailored specifically for sustainable investing.
  1. Capitalizing on bondIT’s AI-Driven Platform for Sustainable Fixed Income Investing

bondIT’s flexible AI-powered platform enables investors to include their proprietary ESG data and leverage comprehensive tools and features to create sustainable fixed-income investment strategies:

  • Integration of ESG factors into credit analysis: bondIT’s advanced credit analytics incorporate ESG factors into traditional credit risk assessments, enabling investors to build portfolios with sustainable issuers.
  • Tailored portfolio construction: bondIT’s AI-driven algorithms generate customized sustainable fixed-income portfolios that reflect individual investor preferences, risk appetites, and financial goals.
  1. Boosting Efficiency, Performance, and Scalability in Sustainable Fixed Income Investing with bondIT

Adopting bondIT’s AI-powered platform for sustainable fixed-income investing can result in numerous benefits for asset managers and wealth managers:

  • Streamlined ESG data management: Utilizing bondIT’s platform, investors can consolidate their ESG data sources and maintain a unified view of ESG metrics and bond issuer sustainability profiles.
  • Enhanced decision-making: Through access to customizable scoring models, bondIT’s platform simplifies the decision-making process for investors seeking to align their fixed-income portfolios with ESG criteria.
  • Superior risk-adjusted performance: Combining advanced credit analytics and ESG factors, bondIT’s platform supports the construction of diversified sustainable fixed-income portfolios that balance risk and return effectively.
  • Augmented client relationships: With the ability to create tailored sustainable fixed-income investment strategies and provide in-depth reporting on ESG alignment, bondIT’s platform strengthens the platform users’ relationships with their clients, who are increasingly focused on sustainability considerations.

 

Realize the Promise of Sustainable Fixed Income Investing with bondIT’s AI-Powered Platform

bondIT’s platform equips asset managers and wealth managers with the tools they need to navigate the world of sustainable fixed-income investing successfully.

By using bondIT’s AI-powered platform, investors can build sustainable fixed-income portfolios that align with their values, manage risk effectively, and unlock opportunities for long-term, superior risk-adjusted returns.

Request a demo of bondIT’s investment management software today and harness the power of sustainable fixed-income investing to drive efficiency, performance, and scalability in your investment processes.