Peer Comparison

This chart illustrates the portfolio's position within its reference universe, defined by its currency and risk level pair, in a risk-return framework.

A cloud of anonymised data points represents the community. The benchmark serves as a reference line passing through the risk-free return. This slope represents the Sharpe ratio of the index. Any point below this line has a risk-adjusted return lower than the benchmark in question.

The Weather lines show how an instrument's risk and return compare to its reference index.
Their shape adapts to the market regime:

• In positive markets, instruments taking too little risk are slightly penalised (opportunity cost), while those taking too much risk are penalised exponentially. Around the index, Weather improves with better risk-adjusted returns.

  

• In negative markets, instruments that preserve capital (lower risk and smaller losses) are rewarded, while excessive risk is again penalised. Around the index, Weather still favours better risk-adjusted returns, but gives more weight to capital protection.

In short, the Weather adjusts dynamically to market conditions—rewarding efficient risk-taking in up markets and prudent capital protection in down markets.