SimCorp, a global leader in financial technology, and Axyon AI, a fintech specializing in advanced predictive AI-driven solutions for asset managers, hedge funds and institutional investors, have jointly published ​​From AI Signals to Active Returns: A Portfolio Manager’s Guide to Capturing Consistent Alpha.

The white paper examines how AI-generated stock-ranking signals — when paired with institutional-grade portfolio optimization tools — may translate into tangible active returns. The research analyzes a 10-year historical test period from 2015 to 2025, focusing on US All Cap equities benchmarked against the Russell 3000 index.

The research tests a range of long-only portfolio strategies across different active risk targets, assessing whether AI-driven signals can help generate consistent outperformance over a full market cycle. The results suggest the approach may deliver active returns that are broad-based and repeatable — with the strategy generating positive active returns in 61 percent to 65 percent of all months tested over the 10-year period.

“This paper reveals that Axyon AI’s portfolio signals serve as a consistent source of active return within a broader mandate over US Stocks,” said Daniele Grassi, co-founder and CEO, Axyon AI. “Notably, the majority of the alpha generated is stock-specific, proving that the AI successfully identifies sources of return that go beyond traditional factors.”

“Even good alpha forecasts can lose their power if the portfolio construction process is not robust, recognizing that expected return must be traded off against risk to ensure the best possible performance that is consistent and repeatable,” said Melissa Brown, Head of Investment Decision Research at SimCorp. “We see the strong, effective signals from Axyon AI and the Axioma by SimCorp optimization and risk modeling capabilities as a winning combination to help investors produce consistent risk-adjusted returns.”

Axyon AI is part of SimCorp’s partner ecosystem, providing SimCorp One clients with easy access to Axyon AI’s predictive analytics directly within the platform. SimCorp’s partner ecosystem is designed to provide clients with access to innovative third-party solutions across the investment management value chain, ensuring seamless data flow within clients’ operating environment, delivering faster time to value.

Access the full white paper here to explore how AI-driven signals and institutional-grade portfolio optimization tool may give your portfolio an edge.

Source: SimCorp