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I am proposing a change in R2G in order to increase the confidence level of potential clients and attract many more.

Instead of having a model carved in stone that everybody follows, rent out a model. The ranking system and buy/sell rules would be hidden BUT a client could add his own sauce to the mix:

- John Doe likes Oliver's 50 stocks model but he just want 30 stocks? Fine he can change the number of holdings. He doesn't want MLP ? he can add a buy rule or change the universe and then backtest the results and generate a portfolio.

- Jane Doe is busy Monday morning ? No problem she'll just generate her recommendations Wednesday. She doesn't like a stock ? she can just generate another recommendation.
- This one wants to put a system through torture tests? he can backtest the model turning off buy/sell rules (though they remain hidden), add slippage, add whatever buy rules he needs.
- Finally for the many that don't want a low liquidity system, they can just rent out the model and run it on their own custom universe. For those that don't like high turnover they can add a "rank" sell rule that would take precedence over the one built-in to lower the turnover.

The business model of R2G would change from that of a typical newsletter to become a marketplace where designer can provide raw systems customizable by the end-users.
We'll be the only one doing this.
And customers confidence would greatly improve from the ability to run unlimited backtests and adjustments.
Results: Total score: 33, # of Votes: 10, Average: 3.3
a
 
24 (6)
b
 
6 (2)
c
 
2 (1)
d
 
1 (1)
Scores are calculated as (importance) × (# of votes), where importance ranges from 1 to 4.
Requested by: aurelaurel
On date: 11/26/13
Category: Portfolio

11 comments