Investment strategies are only becoming increasingly complex. Investors inevitably face tradeoffs balancing numerous objectives that not only include traditional risk-return considerations, but also sustainability criteria.
To help our clients meet their multiple investment objectives, we combine leading optimization and risk analytics capabilities with innovative index construction to balance these different tradeoffs and build indices that satisfy our clients’ unique needs. And, by taking an open architecture approach to index construction, we can work with a range of best-in-class data from leading providers to ensure the right fit regardless of the investment strategy.
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Use our optimization and portfolio analytics in the index construction process to balance the tradeoff between risk, return and other objectives:
- Incorporate sustainability objectives related to sustainability performance (typically measured by an ESG score) specific climate profile and contributions to the SDGs: For example, maximize sustainability exposures for a given level of tracking error or minimize tracking error while obtaining the highest possible ESG score.
- Obtain desired factor exposures: For example, tilt to one or more factor exposures to enhance returns over time while minimizing tracking error, turnover, and other deviations from the broad market.
Overview of the Qontigo index construction process: Bringing analytics and index methodology together
Get high touch client support from our in-house research and index specialists from start to finish.
Proprietary optimization: Transparency and control
Portfolio optimization is not a black box, but one where you have control over the inputs. Used for index construction as well as research and decision support, we offer clients high-touch service from our in-house optimization, research and index experts from start to finish.
Full-time specialists holding Optimization PhDs
Years of indexing experience
Patents on the market-leading Axioma Portfolio Optimizer
Our range of analytics-enhanced indices
STOXX and DAX ESG Target Indices
Designed to maximize a portfolio’s ESG profile while getting as close to the benchmark returns as possible.Explore More >
STOXX Factor Indices
Target intuitionally tested factors – derived from the Axioma Factor Risk Models – across various geographies.Explore More >
STOXX ESG Factor Indices
Target similar levels of factor exposures as the STOXX Factor Indices with additional ESG screens.Explore More >
In practice: case studies
Developing an ESG enhanced version of DAX for BlackRock
The DAX ESG Target index was developed in collaboration with BlackRock, the world’s largest asset management firm. The index combines a tracking error target relative to the parent DAX index with ESG filters and carbon reduction targets. ESG data is provided by Sustainalytics.
Customized sustainable climate indices created for Northern Trust’s FlexShares
We designed four indices that integrate FlexShares’ proprietary ESG and factor scores. The indices aim to capture the excess returns associated to factors such as quality, low volatility and dividend yield while adjusting for sector, region, country and security-level biases.
Climate transition indices launched with Willis Towers Watson
The STOXX Willis Towers Watson Climate Transition indices were developed in close collaboration with Willis Towers Watson (WTW) incorporating their proprietary Climate Transition Value at Risk (CTVaR) data.
“Layered” Approach to ESG Results in Innovative Responsible Indices for APG
We devised a series of co-branded indices that offer investors a spectrum of strategy tools and specific optionality, and gave our client flexibility, full support in index management, and the objectivity of a third-party index provider