An Overview

At INTECH, we approach equity portfolio construction differently from most other managers – quantitative or fundamental.

  • We view volatility as a source of potential reward rather than a source of risk.
  • We attempt to "capture" that natural volatility in the form of an excess return by systematically rebalancing stocks back to their target weights.
  • We don't make any assumptions about the economy, the stock market, individual companies or any other factors to construct our clients' portfolios.
  • This methodology is unlike other managers, most of whom select stocks for their portfolios based on a company’s fundamentals (e.g., P/E ratios, cash flow, etc.).

Our process is based on establishing a portfolio of stocks with weights that differ from those of the benchmark, taking into account volatility and correlation characteristics. Stocks that behave differently from other stocks create an opportunity to capture their price movements by rebalancing stocks back to their target weights – systematically buying shares as stock prices move down and selling shares as stock prices move up, thereby capturing some of those price movements in a trading profit. Over time, this sophisticated ‘buy low/sell high’ methodology creates a stable and persistent positive alpha source.

At INTECH, we believe that our responsibility to our clients doesn't end with generating alpha. Because volatility can rapidly destroy wealth, we have specific risk controls embedded into our investment process to help protect our clients' portfolios through many different market cycles. We believe this is the real value we provide to our clients.

The INTECH Difference

  • Providing Value to Clients

    The potential benefit of INTECH’s mathematical process is that it takes the least amount of risk needed to achieve a target return, while producing more consistent returns over the long-term. The foundation of our process has been the same since we launched our flagship strategy, U.S. Enhanced Plus, in 1987.

  • Using Volatility as a Source of Reward

    At INTECH, we approach stock-market volatility as the fuel to generate returns greater than the benchmark with similar or lower risk, or market-like returns with significantly less risk than a cap-weighted index.

  • Helping to Protect Portfolio Values

    Risk management is a key to generating alpha. The risk controls embedded in INTECH's process seek to protect the portfolios on the downside through many different market cycles.

  • Applying Mathematics to Construct Portfolios

    INTECH uses mathematics to construct portfolios with the potential to generate returns greater than the benchmark with less risk, or market-like returns with significantly less risk than a capitalization-weighted index.