Certainty in an uncertain world

www.cambridge-systems.com

Solutions

Bridging theory and practice

Individual Asset Liability Management (iALM)

'People are poor forecasters of their future emotions and future tastes - they need help in this task' Daniel Kahneman

Our intelligent Robo Advisor imitates the behavioural aspects of individuals' decisions.

iALM is goal-oriented financial advice software that helps households to

  • objectively estimate financial possibilities over their life span
  • plan their finances for years to come
  • make optimal investment decisions today
  • optimize savings accumulation
  • consider individual household specific wishes and features

iALM has unique advantages over all other Robo Advisors currently on the market.

It takes a holistic approach in which all of your goals, priorities, liabilities and personal circumstances are considered at the same time, so the asset allocation recommendations are demonstrably better (see our paper) than the standard more simple approaches (e.g. using separate funds for each goal or using a life-cycle fund).

Taking into account future portfolio dynamics

  • makes your decisions today most appropriate personally for you, which is equivalent to increasing your investment returns per annum significantly
  • lets you save on transaction and fees costs over the course of your life
  • produces more robust asset allocations

Expected longevity can be greatly underestimated by a person. Our system takes mortality risks into account when giving advice on investment. It can inform a user on the probabilities of good and bad scenarios.

Our system is based on a Dynamic Stochastic Programming approach. It has been demonstrated theoretically to be better than standard Robo Advisors. In practice it has been back tested versus the best human financial advisors and positively evaluated by them.

 

    Standard
  Robo Advisor

    iALM

Holistic optimization:
      goals (children's education, mortgage, etc.)
      taxes, transaction costs, fees, etc.
      every goal influences decisions on all other goals

Future dynamic portfolio allocation

Advice on how much to save

Takes into account longevity risk


Download recently published iALM papers here, here and here

Download a presentation showing a sample client report here