Portfolio123 backtesting software and ranking system enables investors to invest in stocks and ETFs based on clear defined rules, advanced ranking systems, backtests, and analysis using their quantitative tools and stock screeners.
This Portfolio123 review will guide you through the stock screening tools, ranking systems, and backtesting engine. I’ll also provide a link to an extended 35-day trial, but now let’s start with the core functionalities needed to build investing strategies.
Once you have logged in to your Portfolio123 account, you will see four main navigational items.
- Manage: Quick links, trade, models, misc
- Research: Your models, components, advanced components, tools
- Data: Stocks and ETFs, tools, misc
- Learn and Connect: Research, resources, forum, support
Each of those sections includes links to the core features that belong to the overall topic. Below you find insights into some of the main features.
Select manage > models > Portfolio123 models to access the pre-configured portfolio models. Currently, it includes 12 stock models, 5 core allocation models, 3 beat the S&P 500 models, and 3 fixed income models. You can click through the different models, and you will see an overview of the strategy, number of stocks, yield, short-term and longer-term growth with performance stats.
By clicking on the specific strategy, you reveal the exact performance data with graphs and details to the DIY investing details. Some of the rule-based portfolio models require a rebalancing every 3 months, some more frequently. Those who want can copy the portfolio and execute it in their brokerage account. An interesting planned feature is the so-called Portfolio123 advisor.
Portfolio 123 Advisor
This is a service expected to be released soon. The advisor service makes rule-based investing simple while keeping the ownership, using expert strategies, and using tailored risk profiling and automatic rebalancing. You need to open an account with Portfolio 123 Securities to use this service. However, a bit more patience is required before it’s available. Until then, the portfolio models can be used by executing the trades by hand in the brokerage account, or by relying on Ariston Advisors until Portfolio123 Security is available. They will invest the users portfolio using a selection of the Portfolio123 models with the respective risk tolerance level.
Have you ever been curious if investing based on Piotroski, Greenblatt, Lynch, CANSLIM or Buffett has ever beaten the S&P 500 performance and, if so, in what periods? Then the Portfolio 123 screener is a good choice. The Portfolio 123 screener can be found at research, your models, screens.
Here you currently find 76 pre-configured screeners categorized by:
- All-Stars: Everything from Piotrosky to Buffet
- Breadth: ETF-screen based on SPY above 200 moving average
- ETF: Market timing investment strategies
- Long-Short: Value factor investment strategy
- Reuters Select: Investing based on quality, value, sentiment and growth
- Special Functions: Correlation matrix
- Special Themes: Small caps, dividend income, top-line prowess, large-caps and more
- Style Specific: Screeners based on growth, value, sentiment, and quality
The Portfolio123 screener is impressive, and I have never seen anything similar before. Sure, one part of the screener simply provides a list of all stocks that meet specific criteria. This is something that some other screeners might do as well.
The point is that Portfolio123 pre-configured all those screeners. All rules are already implemented, all rules are entirely transparent, the rules can also be adjusted, and most importantly, everything can be backtested with a data history since 1999 for ETFs and 20 years for stocks. There is one exception, if you subscribe to the lowest plan called Screener, the history for stocks will be limited to 5 years.
Portfolio123 Backtest Engine
The Portfolio123 backtest engine is the fastest back testing tool I have ever used for this type of investment-related analysis. My favorite stock screener for day trading is still Trade Ideas, but it is important to understand that Portfolio123 does the job for an entirely different purpose.
Other fundamental data tools like Stock Rover and Finbox also do a decent job for basic scanning queries, but Portfolio123 can do much more, much faster and based on high-quality data from FactSet.
- Is it only a theory that industry leaders perform better than the market average?
- Is it worth it to invest in companies with high P/E multiples?
- What rebalance-frequency works best?
- Is it worth it to invest based on the price per share relative to the moving average?
- Is CANSLIM developed by Investors Business Daily worth it?
You can quickly answer those questions by simply using the powerful backtest engine.
I’m still stunned by the performance. It takes about a second or maybe one and a half until you see the full backtest information after Portfolio123 took all the rules, applied them to thousands of stocks, filtered out the correct stocks based on the defined criteria, and present a graph with performance relative to a benchmark chosen by you.
IMO it is impossible to do something similar on your own in Excel, Powerpoint, or C#, SAS etc.
Are you still undecided about whether or not to take the test drive for 35 days?
You can modify the rules based on the integrated criteria rule references. Those rules are based on income statement aspects, technical analysis filters, ranking systems, industry, sector, and various other criteria.
And if even those hundreds of filters are not enough, you can also add custom formulas.
The charting feature can be found under the navigational item Data. You can visualize stock and exchange traded funds with additional detailed statistics, news, technical data, fundamental data, rankings, and you can add personal notes.
The multi-chart tools allow you to visualize stock prices, ETFs on one panel, various panels. You can choose the date range. You can also use the integrated ranking system methods and compare the performance per share relative to the benchmark. Stock splits are visualized in the chart, and the same goes for the dividends. Furthermore, you can choose to show the chart split and dividend adjusted or without those price adjustments.
Besides traditional charting capabilities, also fundamental charts can be used to visualize historical point-in-time fundamental data. You can either use the integrated pre-build categories to analyze stocks and ETFs, or you design your own fundamental charts using any of S&P’s estimate, technical, industry, or fundamental data.
An extended 35-day trial for $9 is available. Once the 35 days are over, you chose between the following membership levels:
Retail Investor Plans:
- Screener: $50 per month billed month to month, or $299 per year (equals $25 per month)
- Backtest Engine: $120 per month billed month to month, or $1,000 per year (equals $84 per month)
- Portfolio: $180 per month billed month to month, or $1,600 per year (equals $134 per month)
- Ultimate: $270 per month billed month to month, or $2,400 per year (equals $200 per month)
Asset Manager Plans:
- Between $3,000 per year for Tier 1 and $12,000 per year for Tier 3, mainly depending on the number of quant research requests and resource units.
- Between $3,000 and $15,000 per year.
Students, professors, educational institutions:
- Contact Portfolio123 for details costs about the same as for a textbook
Portfolio123 Review Conclusion
Portfolio123 is a powerful stock screener with extensive company data, industry data, stock universes, and even custom formulas. You can model new trading systems and define investing strategies based on backtesting results using high-quality historical data and ranking systems.
The capabilities go far beyond the functionalities covered in this Portfolio123 review. This makes the 35-day trial is the best possible starting point. Investors can use the test drive to have a look at all data sources, test the stock screening tool, backtest pre-configured stock investing strategies, and analyze the results to gain a trading edge.
Frequently Asked Questions
How much is Portfolio123?
A subscription to Portfolio123 starts at $25 per month for individuals, $3,000 per year for asset managers and research firms. Students receive rebates, and all subscriptions can be started with a one-time fee of $9 for an extended 35-day trial.
How much historical data is provided?
The data points available to backtest cover everything from 1999 until today for ETFs and 20 years for stocks with the , while the historical data for charts goes back up to 50 years. Stock strategies and ETF strategies can be backtested with the data. If you use the subscrition level Screener, your stock data history will be 5 years.
How comprehensive is the stock universe?
FactSet provides the data since July 2020. Users currently have access to North American data. Portfolio123 plans to add global data from Europe and the Asian Pacific area.