Services : Investment Consulting


Coast Investment Consulting function provides consultancy on strategic investments to its clients. The service mainly involves designing optimal portfolios with respect to the specific needs and expectations of our clients. We are proud to be the first investment institution in Kuwait and the GCC region to adopt the most sophisticated asset allocation software and modeling techniques to better serve our individual and institutional clients in fund selection and asset allocation construction. Our investment consulting group takes our customized, state-of-the-art investment research and creates asset allocation programs for the purpose of guiding our clients taking into account the client’s specific needs.

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Coast asset allocation methodology involves an effective, internationally recognized process summarized as follows:

  1. Develop Asset Class Inputs
    Based on client’s input, Coast analyzes the asset class to obtain expected returns, standard deviations and correlation coefficients. The input would later be utilized for the mean-variance optimization of the portfolio. Forecasting expected returns is obtained by a combination of historical returns, current socio-economic conditions and structural time series modeling.

  2. Create Asset Class Models
    Creating asset classes involves the employment of the statistical analysis to create a Mean Varience Optimization Model. The goal of optimization is to identify asset allocation that maximizes return for a given level of risk or minimizes risk for a given level of return. MVO combines the asset class inputs to generate the highest return with the lowest risk.

  3. Qualitative and Empirical Investigation
    Quantitative and qualitative analysis is based on investment options to determine the true investment style. Quantitative analysis contains Return Based Style Analysis, Alpha and Tracking Error. After the completion of the quantitative analysis, qualitative analysis will be applied to review the investment options, such as manager tenure, investment process style consistency and regulatry actions.

  4. Portfolio Construction
    Once the asset class models are determined and the investment options are analyzed, we come up with the appropriate combination of investment options using the alpha-tracking error optimization.

  5. Portfolio Review and Rebalancing
    Regular reviews are conducted on the constructed portfolios to insure consistency in its stated stratigic asset allocation target.

Optimal Portfolio Simulation Modeling for the Kuwait Equity Market

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