Investment Configuration

Investment Configuration

In order for Asset Rebalancing to maintain investment ratios, it must make debits and credits to redistribute the assets. Therefore, different asset types must have different G/L accounts – each representing an investment pool.

For example, you might have a money market pool, a fixed income (bond) pool, and an equity (stock) pool. You might also have assets in a checking account, which is set up as a dummy pool so it can participate in the rebalancing system. Within any pool (in FACTS), you can have any number of investment entities (for example, custodial accounts or money managers), as long as all of them offer the same kind of investment.

You could also have two or more pools of the same kind (for example, two stock investment pools), but you could not have a balanced or mixed pool that included both bonds and stock investments if you want to directly control the investment mix.

If you are using Asset Rebalancing only for cash management, your investment pool could represent a balanced portfolio. In this case you could have a single pool. If you had more than one you would have to set an investment ratio among the pools.