This blog post will discuss how to create an equally weighted composite inside of Zephyr StyleADVISOR. An equally weighted composite allows you to take a large group of managers and create a single return stream that can be used in any analysis. Managers are given an equal weighting based on the number of managers in the group. Below we will go over how to create an equally weighted composite from start to finish.
The process of creating an equally weighted composite in Zephyr StyleADVISOR is done through the manager search feature available in the gallery. To access the manager search feature, first click on the File Menu> New, this will give you a blank workbook to add your manager search. Once the blank workbook opens up, the gallery will be available on the left. From the gallery click and drag the Manager Search table, located third from the top, into the blank white space on the right.
After clicking and dragging the manager search table into the white space the Analysis Parameters window will appear. Click Select Managers… button located at the bottom of the window.
By clicking on the Select Managers… button, this will open the Select Managers window. You have a few different options to select managers to build the equally weighted composite. One option is to begin searching for managers by typing into the search bar. Another option is to use the advanced search to narrow down a group of managers based on specific search criteria that you list. Additional information can be found on the advanced search filter in our previous blog posts, here . A third option would be to select a predefined universe of managers; either custom or vendor provided that you would like to turn into a single return stream. Instructions for using a vendor provided universe are listed below. If you rather create your own custom universe and an equally weighted composite from that, instructions can be found in another of our previous blog post here.
In the Select Managers… window, first click the database dropdown in the top left corner, then click the arrow located to the left of Blends/Universe/Style Basis and then do the same for the arrow located next to Universes. This will show you the different universe groupings you have available. Select your universe group and click the arrow located to the left of the name. In my example I have chosen the Morningstar Universes and selected the Morningstar Bank Loan universe as the specific universe I would like to create an equally weighted composite from by checking the box to the left of the name.
Now that the universe has been selected, click anywhere outside the dropdown menu to load the selected universe. At this point you will be able to click the in the top left under Search Results to select all managers in the universe and click OK in the bottom right.
This will load all the selected managers into your Analysis Parameters window. Click OK.
Once the manager search has loaded completely, the last step is to right-click on the screen and select Save Managers as Equal-Weighted Composite…
This will bring up the save window, here you will need to create a file name to your composite. Leave the default save location to your Zephyr StyleADVISOR’s data home, as this is where Zephyr StyleADVISOR will look for the file. After creating a name, click Save.