ESSENTIA ANALYTICS LAUNCHES INNOVATIVE TOOL FOR ASSESSING PORTFOLIO MANAGER SKILL
Peer benchmarking app compares active investors based on decision-making skill, not just past performance
April 11, 2024 — London, New York — Essentia Analytics, the leading provider of behavioral data analytics for professional investors and allocators of capital, today announced the launch of the Essentia Behavioral Alpha® Benchmark app, a web-based tool for assessing portfolio manager decision-making skill.
Since 2013, Essentia’s flagship Insight Advantage service has combined sophisticated decision analytics, coaching and behavioral nudges to help active equity portfolio managers quantify and improve their decision-making skill. At the core of this service is the Behavioral Alpha Benchmark, Essentia’s proprietary, peer-reviewed assessment methodology which considers the value added or destroyed by a manager’s individual decisions in stock picking, timing, sizing and more. Unlike past performance, this measure of investment skill is resistant to the random effects of luck, persists over time and is linked to future relative portfolio returns (see new research from Essentia).
The app — publicly (and freely) accessible at www.behavioral-alpha.com — powers Insight Basic, a new Essentia offering that provides portfolio managers and asset allocators direct access to the Behavioral Alpha Benchmark assessment in a simple, streamlined package.
The new app enables portfolio managers and allocators to compare managers by their Behavioral Alpha Scores, the topline measure of decision-making skill produced by the Behavioral Alpha Benchmark methodology.
Among the features now available to investors:
- Compare managers by their Behavioral Alpha Scores, the topline measure of decision-making skill produced by the Behavioral Alpha Benchmark methodology
- Filter managers by geography, style and market cap
- Add portfolios to the Behavioral Alpha Benchmark for comparison, and invite managers to add their portfolios
“The investment management industry has always struggled to distinguish skill from luck,” says Essentia Founder and CEO Clare Flynn Levy, “but the Behavioral Alpha Benchmark app makes it easy — and economical — to identify a portfolio manager with decision-making skill in comparison with peers. The number of portfolios involved is growing daily, making it rich for exploration.”
About Essentia Analytics
Essentia Analytics is the leading provider of behavioral data analytics services to professional investors and allocators of capital. Led by a team of experts in investment management, technology and behavioral science, Essentia combines next-generation decision attribution analytics technology with human coaching to help both equity fund managers and allocators identify investment skill and bias — and capture performance that was previously being lost to decision-making deficiencies.