Quantext

NOTE: Quantext is not a registered investment advisor. No information on this website should be taken as advice to buy or sell any asset. Any and all information obtained from Quantext is on an "AS IS" basis.

©2012 • Quantext, Inc.

Who We Are

Quantext is small software and consulting firm based in Boulder, Colorado. The firm was founded by Geoff Considine in March of 2002. Quantext focuses on the theory and practice of portfolio management. Quantext Portfolio Planner (QPP), our flagship product, is used by an international clientele of wealth managers and sophisticated investors. QPP generates forward looking projections of risk and return for portfolios of stocks, ETF's and mutual funds and it uses Monte Carlo Simulation to determine savings rates and sustainable income in retirement. Geoff Considine has written over two hundred articles on these topics, as well as some books. Quantext has worked closely with Folio Investing since 2007.

NOTE: Quantext is not a registered investment advisor. No information on this website should be taken as advice to buy or sell any asset. Any and all information obtained from Quantext is on an "AS IS" basis.

©2012 • Quantext, Inc.

Articles

The Ultimate Income Portfolio: 7.1% Yield with Low Risk
In July of 2010, I introduced a portfolio-construction strategy called the Ultimate Income Portfolio (UIP). I have updated that strategy annually, revising the holdings and reviewing the previous year’s results. My goal is to provide the maximum available yield while diversifying to reduce risk. I set a target risk, which is within the range that most individual investors seek. I also sell covered call options against portfolio holdings to increase income.

In this article, I analyze the performance of last year’s UIP and generate the UIP for 2014-15. The result is a portfolio that yields 7.1% with a risk level equivalent to a 70/30 stock/bond index fund. I also explore some of the lessons learned from four years of tracking and revising the portfolios.
Are Dividend Stocks Too Expensive?
Dividend strategies tend to have a strong value tilt and lower price-to-book (P/B) and price-to-earnings (P/E) ratios than the market as a whole. But those strategies can become overvalued. When this occurs – we are currently in such a period – building a high-dividend, low-risk portfolio requires extra care.
Do Commodities Belong in Your Allocation?
For much of the last several years, poor performance from commodities has hurt investors’ portfolios, a result of depressed interest rates, low inflation and slow economic growth. Any diversification value they provided was masked by strong equity-market performance. My analysis shows that only a small allocation to commodities is justified, and advisors can obtain most of the same benefits with real-estate investment trusts (REITs) or individual Treasury inflation-protected bonds (TIPS).
Understanding the Controversy over Dividend-Based Investing
Should investors favor dividend-paying stocks over non-payers? A long-held investment tenet contends that they should. But in a controversy that has pitted two highly respected investment firms – New York-based Tweedy Browne and Texas-based Dimensional Fund Advisors (DFA) – against one another, advisors are being asked to reexamine this issue.
The Risk Forecast for 2014
It’s the time of year when market pundits take to the notoriously difficult task of forecasting returns. Volatility is equally important, however, and it can be predicted much more reliably than asset-class performance. My forecast shows that the options market is underestimating risk in 2014, giving investors an opportunity to purchase portfolio protection at attractive prices.
The Bomb Shelter Portfolio: Maximum Income with the Least Risk
Conservative investors are faced with unappealing choices. They can reduce risk and accept low yields and high exposure to rising rates, or they can push the bounds of their risk tolerance to increase yield. My analysis shows a way out of this predicament: a “bomb shelter” portfolio of exchange-traded funds (ETFs), which offers attractive yield with minimal volatility and exposure to rising rates.
The Ultimate Income Portfolio Revisited
Rising interest rates will be unkind to income-generating assets and the investors who depend on them in retirement. My ultimate-income portfolio (UIP) provides a solution to this problem. It has reliably produced high income and low volatility with respect to the stock market, and its performance is likely to continue, even if rates rise further.
Do Income-Oriented Portfolios Reduce Safe Withdrawal Rates?
Among studies of safe withdrawal rates (SWRs) researchers have followed a common path: constructing portfolios with the goal of optimizing total return. This strategy achieves the highest SWR, but retirees often prefer a more income-oriented portfolio. I will illustrate the tradeoff investors make – in terms of a lower SWR – as they increase allocations to income-producing securities. But increasing income also brings a key benefit: lower estimation risk.
The Power of Diversification and Safe Withdrawal Rates

When Bill Bengen published his seminal research in 1994, a 4% safe withdrawal rate (SWR) was clearly attainable with a variety of asset allocations. But bond yields are lower now than they were then, and equity returns for the next 20 years are unlikely to exceed those of the prior two decades. Indeed, a new paper by three highly respected researchers showed that SWRs for stock-bond portfolios are well below 4%. But as I will demonstrate, a 4% SWR is still possible with a more diversified portfolio – and without subjecting clients to additional risk.

A Better Alternative to Cap-Weighted Bond Indices, 2013
Capitalization weighting is the prevailing choice for equity index investors, who can choose from low-cost index funds constructed with theoretically proven methodologies. But capitalization weighting in fixed-income markets enjoys no such theoretical foundation, leaving investors without a clear choice for a diversified core fixed-income holding. A portfolio of bond exchange-traded funds that optimizes the tradeoff between yield and risk gives investors a commendable way to own a broadly diversified core allocation.

NOTE: Quantext is not a registered investment advisor. No information on this website should be taken as advice to buy or sell any asset. Any and all information obtained from Quantext is on an "AS IS" basis.

©2012 • Quantext, Inc.

QPP

Quantext's Portfolio Planner generates forward looking projections of risk and return for portfolios of stocks, ETF's and mutual funds. QPP uses Monte Carlo Simulation to determine savings rates and sustainable income in retirement.

NOTE: Quantext is not a registered investment advisor. No information on this website should be taken as advice to buy or sell any asset. Any and all information obtained from Quantext is on an "AS IS" basis.

©2012 • Quantext, Inc.

Information about QPP

Quantext portfolio planners provide:

Many asset allocation tools simply look at historical behavior of portfolios.  The standard of practice in institutional finance, however, is forward-looking portfolio analysis.  QPP is a forward-looking portfolio analysis tool.

We believe that QPP is the very best portfolio planning and asset allocation tool available--and we have performed numerous analyses and tests to demonstrate that this is the case.  We have a series of these studies available for your review in our library.

NOTE: Quantext is not a registered investment advisor. No information on this website should be taken as advice to buy or sell any asset.  Any and all information obtained from Quantext is on an "AS IS" basis.

What Make Quantext's Tools Special?

Many systems use shortcuts that assign investments to broad classes (style analysis), but ignore specific details of a position.  Two funds of similar 'style' might be projected to have exactly the same future risk and return even if they have historically been quite different in that respect.  Our approach of accounting for each asset individually also means that our approach will tend to be better for portfolios that are concentrated. 

NOTE: Quantext is not a registered investment advisor. No information on this website should be taken as advice to buy or sell any asset. Any and all information obtained from Quantext is on an "AS IS" basis.

©2012 • Quantext, Inc.

Versions

We offer two versions of our portfolio planner. QPP handles up to 20 assets in a portfolio. QPP40 handles up to 40 assets per portfolio.

We bundle QPP(20) in with all QPP40 licenses; some people like to study smaller portions of their portfolios in QPP(20) because it runs a little bit faster than QPP40, although, thees days, connection speeds are so high that the speed is not really an issue for most users.

NOTE: Quantext is not a registered investment advisor. No information on this website should be taken as advice to buy or sell any asset. Any and all information obtained from Quantext is on an "AS IS" basis.

©2012 • Quantext, Inc.

Books

Geoff Considine has written multiple books that we sell from our website. Though the Full Site has more information about each book, this gives a brief overview of each.

Survival Guide to a Post-Pension World

This book provides an overview of key investing topics that investors and advisors need to understand in developing investment management strategies to provide for long-term income or other goals. The book draws together core concepts that Geoff Considine has explored in his articles on portfolio planning, along with new insights and strategies. We explore the tools of portfolio management, the core asset classes that investors need to be aware of, and how to quantify risk and to determine whether a portfolio is a good match to a specific investor's needs. A major theme that we explore is how to deal with risk and uncertainty in long-term planning. Monte Carlo simulation is used to motivate many of the examples and we show a series of ways to get comfortable with Monte Carlo as a planning tool.

Using Options in Wealth Management

While there are many good books on the theoretical aspects of derivatives, there is a need for broad strategic discussions of the use of options as part of wealth management and portfolio planning. In this monograph, I present a coherent conceptual framework to help investors and advisors understand the ways that options can be useful in portfolio management. Options can be used in this manner, but they can also be used as part of well-considered wealth management plan.

NOTE: Quantext is not a registered investment advisor. No information on this website should be taken as advice to buy or sell any asset. Any and all information obtained from Quantext is on an "AS IS" basis.

©2012 • Quantext, Inc.

Free Trial

Quantext offers a free trial of QPP. To request a free trial please hit the button below or email tryqpp@yahoo.com. Include your first and last names. Please put QPP in the subject line.

Information about downloading the trial will be emailed to you (so it is not instantaneous. Thanks for your patience in advance.)

We hope that you enjoy the program!

NOTE: Quantext is not a registered investment advisor. No information on this website should be taken as advice to buy or sell any asset. Any and all information obtained from Quantext is on an "AS IS" basis.

©2012 • Quantext, Inc.

License or Renew

Licensed versions of Quantext's portfolio planners are downloadable. If you would like another free trial to use while you wait for your licensed version to arrive, please email tryqpp@yahoo.com. Please note that you have recently licensed.

See prices on the following page (after you hit the Buy Software button.)

We offer several ways to pay. By paying, you are agreeing to our User Agreement.

NOTE: Quantext is not a registered investment advisor. No information on this website should be taken as advice to buy or sell any asset. Any and all information obtained from Quantext is on an "AS IS" basis.

©2012 • Quantext, Inc.

Reviews of QPP

Reviews of Quantext Portfolio Planner

"The Quantext Portfolio Planner is the best portfolio planning tool I have ever used. It is hard to imagine an investor whose portfolio would not be improved by a road test in the QPP."
Phil DeMuth, Ph.D., Investment Advisor and author

This is truly a great tool. It knocks the socks off anything else I've seen."
Phil Trask, former CFO of Pepsi-Canada

"Unlike most Monte Carlo software that I have reviewed over the years, Quantext Portfolio Planner is not only effective but user friendly (even for clients!). I would suggest planners employ this software not only for their practice but for their clients in interactive sessions.

Finally, a real time great tool to use in conjunction with the deterministic (potentially 'flaw of averages') approach per each accumulation objective."
Jim Schwartz, Co-Founder, National Association of Personal Financial Advisors (NAPFA)

"Twenty-one years from the inception of the Southwest Airline Pilots Association 401k, Dave Fisser, former committee Chairman, and I worked hard to build an age-based retirement program for our participants. Working with our advisor, Dave and I have used the QPP by Quantext to build target portfolios for participants from ages 30 through 75. We have used every part of this program, from the future return expectations, based on mean reversion, to the Diversified Metrics and Low Correlations to increase the longevity of the portfolio. It doesn’t do any good if you out last your money. Our advisor had access to a large scale Monte Carlo Simulator to run all the glide paths portfolios at once, but we used QPP to check the output, using our own funds to make final suggestions. Believe me when I say we used every aspect of the QPP software. We leaned on Geoff’s many articles, but also experimented with numerous ideas and watched how the software reacted. Our confidence in QPP allowed us to control the outcome for thousands of our participants. We recommend QPP to everyone as it is head and shoulders above any other program we have seen out there."
John Nordin, SWAPA Committee Chairman

“Dr. Geoff Considine and his firm Quantext have created the next generation in portfolio analysis software. It is no longer enough for advisors to manage their clients’ money. If you are not managing client risk and cash flow, they will find somebody who does. QPP provides an instant snapshot of portfolio risk and return unlike anything in the marketplace. It is the ultimate client retention tool.”
Brett Alexander, Cash Flow Investment Svcs. LLC

NOTE: Quantext is not a registered investment advisor. No information on this website should be taken as advice to buy or sell any asset. Any and all information obtained from Quantext is on an "AS IS" basis.

©2012 • Quantext, Inc.