Knowledge Base Articles

Skandia Case Study: Pioneering Seamless Digital Wealth

The financial guidance and advice services, which constitute the life insurer’s core business, were among the first to go through the transformation. Joakim Pettersson, the digital strategy and innovation lead at Skandia, believes that digitalisation is “the only way to scale financial advisory services”.

Evida Case Study: How to build an innovative financial advisor in under seven months?

Evida began its path as a family office managing a wide range of assets for wealthy families. Initially, the Swedish financial advisor outsourced the management of equity and fixed income positions to other parties. However, the combination of their interest for factor-based investments and dissatisfaction with wealth management services provided by the largest banks in Sweden, Switzerland and Luxembourg convinced Evida to build their own digital advisory service.

Beyond Modern Portfolio Theory: Expected Utility Optimisation

The modern wealth management industry still relies on the 50-year-old approaches to portfolio management, widely popularized by Markowitz's Modern Portfolio Theory (1952). Despite heavy criticism within the academic circles, the alternative methods remain undeservingly overlooked in practice. In the context of the modern leap for hyper-customization, we look into one of the alternatives to Modern Portfolio Theory in greater detail - the Utility-based approach.

Part II - Portfolio Construction - Sampling & Optimisation

The second part of the “Portfolio Construction”-series explores whether introducing parameter uncertainty to the model would improve the out-of-sample performance of the optimal portfolio. Additionally, the article proposes and tests two adjustments to regular utility optimisation.

Part I: Asset and Liability Management Using LSMC - Introduction to the Framework

In the first part of the ”Asset and Liability Management using LSMC” article series, we outline an ALM framework based on a replicating portfolio approach along with a suitable financial objective. This ALM framework, albeit simplified, is constructed to provide a straightforward replication of the complex interactions between assets and liabilities. Moreover, a brief introduction to the LSMC method used to generate all underlying risk factors is presented.

Blog Articles

How to build engaging and scalable digital investment management journeys?

How can banks and insurers support people, with no training in portfolio theory, to develop confidence in managing their investments? How can they make these journeys scalable? With the right tools, it’s not only possible, but also empowering. 

Seamless Finance: "Do you know where you're going to?"

Planning for a long-term goal, such as retiring in a sunny climate, can be combined with deliberate steps you are taking for practical projects like buying a house, starting a business or saving for your child’s education. Visualising how your savings and investment choices will succeed in different economic scenarios can help guide decision-making. Understanding the tax treatment of different asset classes and pension schemes is important.  Insurance options to protect against business interruption and income loss can be evaluated. There are tools available, but most are limited to one area of financial life, such as your pension, your mortgage or your insurance coverage, and few have the ability to see the big picture as well as identify individual risk preferences. 

Kidbrooke Shortlisted for This Year's Pitch 360 Competition

We are thrilled to be shortlisted for this year’s Pitch360 competition by Innovate Finance in the WealthTech category! And at this point, your vote can make all the difference in us making it to the finals! Please vote for us here, and feel free to watch our short pre-recorded pitch - it will take less than a minute of your time!

Should Buying your House Ruin your Life[style]?

A mortgage may be the most tangible way many of us deal with financial risk on a day-to-day or more accurately month-to-month basis. The risk of interest rate rises and the effect they can have on mortgage obligations can be acute unless they are considered properly and meaningfully. Also, most of us buy the property based on the axiom that prices will drift upwards inexorably. Over the long term, this is probably true. However short to medium term fluctuations can have disastrous implications, for example, if your risk analysis does not prepare you properly for unforeseen events like the global pandemic. Again, few tools available on the market offer an all-encompassing ‘holistic’ framework that can contextualise how we can make such decisions to lead to optimal outcomes but let us try to imagine how such a tool could look.