Bloomberg Markets Magazine reports on how Sybenetix’s Edge software is being used to analyze investment decision making and enabling individuals, managers and coaches to overcome behavioural basis such as loss aversion and confirmation bias. The article explains how Sybenetix, formerly Investment Intelligence, started with GLG in 2009.
The story features charts using proprietary data from Edge that provides unprecedented insight to investment skill through metrics such as success rate, the percentage of investments that generate a positive return and payoff ratio, average return from profitable and unprofitable trades. Edge metrics such as payoff extraction ratio show how managing skills in sizing positions are critical to improving investment performance.
Bloomberg journalist Jeremy Khan reports that from the company’s database of fund managers (Taras) Chaban says, ‘the best hit rate he’s seen is 64 percent; the median is just over 50 percent. Instead, successful investors tend to make money because of superior payoff ratios, and these can be improved with coaching.’