The Thematic Investment Portfolio System (TIPS) offers a basket of CFDs that are tied to an underlying theme. Through this method, TIPS addresses 3 concerns that we have been hearing from clients:
- Provide “Trade-able research” – but keep this updated
- Provide greater diversification in stocks, sectors and markets traded – but to do this simply
- Help me understand how my choices are performing in the market
The TIPS portfolio focuses on an "Investment Idea" which becomes the Portfolio Theme. In order to build the TIPS portfolio, TIPS rigourously scans and methodically builds Investible TIPS portfolios using a top-down approach to provide investors an opportunity to generate Α (i.e. measure of an investment's performance compared to a benchmark, such as the S&P 500 [CNBC]).
Through this fact-based selection criteria, stocks are selected and weighted. This theme is then clearly explained to the investor so he is able to understand and identify investible future trends and themes.
Why use TIPS?
One of the key challenges in investing is successfully identifying and capitalizing on an idea – TIPS aims to make this easier by:
- Identifying the central Investment Theme and then methodically building the collection of stocks in that portfolio that represent the idea.
- Regularly reviewing the Portfolio with the same criteria, making changes in the composition or weight so that the portfolio continues to best represent the central investment idea/theme
- Managing trading and risk limits, and
- Researching truly distinct and incisive insights.
We have many examples of industries, established or newly emerged, which grow and prosper. Within these, there is often little indication of which company will come to dominate the industry. TIPS suggest that successful investing is more about selecting baskets of investments rather than single securities.
In the past, thematic investing was available to institutional investors and not widely available to non-institutional investors as it was:
CGS-CIMB has understood the need to make this financial technology more broadly available and our TIPS platform provides all investors a more creative and systematic approach to investing.
Table of Comparison
|TIPS||Equities (Cash Trading)||Unit Trusts / Trust Funds|
|Risk Level||Risk is reduced through diversification||Risk is usually higher due to individual stock picking||Risk depends on fund strategy|
|Leverage||Leverage is granted to potentially increase earnings||No leverage is given**||Usually no leverage is given|
|Professional Advice||All TIPS are researched and selected by professionals at no added cost||Market research documents are available for individual stocks, but client must spend time to read through all||Costs are incurred through annual management fees|
|Rebalancing of Portfolio||Client is notified, then given full control over rebalancing through UI||
Client will need to monitor and perform rebalancing manually.|
ETFs will be rebalanced automatically but client is not given a choice.
|Client has no control over rebalancing of unit trust / trust fund portfolio|
**Some counters (e.g. Leveraged ETFs, Warrants, etc.) may offer leverage
We have a series of videos on TIPS to give you a better idea of what TIPS is about and how TIPS can benefit you. Please click on the links below to view the videos.
Getting Started with TIPS CFD
Go to https://tips.cgs-cimb.com and use the TIPS login credentials that were provided to you.
If you are not an existing client, please click here for more information to open an account