Portfolio Optimization Software

Portfolio Optimization Software, developed by Efficient Solutions Inc., is a software solution designed to provide quantitative asset allocation techniques for portfolio optimization, asset allocation, and retirement planning. According to the vendor, this software is suitable for both investment professionals and sophisticated personal investors, catering to a wide range of businesses. Professionals in the fields of investment, finance, wealth management, asset management, as well as personal investors, can potentially benefit from the advanced features and capabilities offered by this software.

Key Features

Mean Variance Optimization: According to the vendor, this software employs quantitative asset allocation techniques to balance risk and return in a portfolio. It utilizes diversification to optimize the risk-return tradeoff and offers both single-period mean variance optimization (MVO) and multi-period MVO with rebalancing. Users can construct the efficient frontier, which represents portfolios with greater expected return and lower risk, by considering the expected return, standard deviation, and correlation matrix of assets.

Monte Carlo Simulation: The software incorporates Monte Carlo simulation, a technique used to investigate statistics of possible future outcomes. By creating and averaging many different realizations based on assumed probability distributions, users can assess the potential outcomes of their investment portfolios. This feature is particularly useful in the Monte Carlo retirement simulator, MCRetire, which helps users determine if their retirement assets are sufficient for their needs. According to the vendor, it calculates the success probability for a given withdrawal and the allowed withdrawal for a specified success probability, while also incorporating adjustment models for inflation, expenses, and taxes.

VisualMvo (Single-period MVO): According to the vendor, VisualMvo is a single-period mean variance optimizer that constructs the efficient frontier and runs on Windows platforms from Windows 95 through Windows 10. It supports up to 20 assets (5 in the 30-day trial version) and allows users to apply simple constraints on each asset. Additionally, VisualMvo provides various table outputs in text or comma-separated format, allowing for easy analysis and interpretation of the optimization results.

MvoPlus (Multi-period MVO): According to the vendor, MvoPlus is a novel mean variance optimizer that focuses on true multi-period (geometric mean) return. It optimizes portfolios that are rebalanced to a given allocation at the end of each period and supports Constant Ratio Asset Allocation (CRAAL) strategies. This feature allows users to back-test and optimize historical data, providing insights into the performance of their portfolios over time. MvoPlus runs on Windows platforms from Windows 95 through Windows 10.

MCRetire (Monte Carlo Retirement Simulator): According to the vendor, MCRetire is a Monte Carlo retirement simulator that takes fluctuations in investment returns into account. It assists users in determining if their retirement assets are adequate by calculating the success probability for a given withdrawal amount and the allowed withdrawal for a specified success probability. MCRetire also includes adjustment models for inflation, expenses, and taxes, providing a comprehensive analysis of retirement planning. According to the vendor, this feature is available for free to purchasers of VisualMvo or MvoPlus.