Measure the true benefit of your portfolio - its diversification
A portfolio is not a series of independent properties with unrelated performance.
There are many factors at the property level which can combine to influence the returns of the portfolio as a whole:
- Sector / Segment
- Lease-end and break-date alignments
- Depreciation cycles
- Yield, rental and capital value movement
- Rent review timing alignments
- External economics such as inflation
- Tenant concentration
For each measure (IRR, Total Returns, Capital Growth, Income Returns), ProMS shows the weighted average result - as if each property was totally independent. It also provides the total portfolio result - taking into account the diversification effects within that portfolio.
By comparing the weighted average results with the whole portfolio analysis, risk managers can, for the first time, quantify the diversification of their portfolio.
ProMS can go further, comparing the diversification of each fund or segment - allowing strategy managers to fine-tune the entire portfolio by comparing the diversification of the elements within it.