The Weighting Method is the final step in the model creation workflow. This step determines how portfolio weights are calculated, how concentration limits are applied, and how the final allocation is prepared before running the backtest.
The Portfolio Allocation Preview provides a visual summary of the portfolio’s expected allocation based on the selected weighting methodology.The preview can be reviewed across several dimensions, including Sector, Size, Country, and Asset Class. This helps users quickly understand how the selected weighting model affects the structure of the portfolio.The preview is shown as of the latest reconstitution date and updates as weighting rules and constraints are configured.
Match Starting Universe Weighting
The Match Universe Weighting button allows users to quickly align the model’s weighting methodology with the selected starting universe.When the weighting step is opened for the first time, BIASafe automatically matches the weighting approach to the selected starting universe by default. This means the model initially follows the same weighting logic as the source index or universe methodology.
If the user modifies any weighting setting, including the weighting approach, weighting model, market-cap basis, currency normalization, or concentration limits, the weighting methodology becomes custom. The Match Universe Weighting button then allows the user to quickly restore the original provider-aligned weighting methodology.
Portfolio Concentration Limits allow users to control how much weight can be assigned to individual securities, sectors, or countries.These limits are applied after the base weighting model is calculated.If no concentration limits are enabled, BIASafe uses the weights generated by the selected weighting model.
Defines minimum or maximum weight limits for individual securities.This is useful when the model should prevent any single holding from becoming too large.
Defines allocation limits by country.This is useful for global or regional strategies that need to control country-level exposure.When concentration limits are enabled, BIASafe adjusts the final allocation to respect the selected constraints before the backtest is run.
