System weights

General
1

I was working with p123 systems and came across unexpected behavior that I am not sure what to make of it.

I am hoping that someone from the community can point me in the right direction.

Here is the most basic example of an issue. I have the most basic system:

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I am trying to pull the ranks for this system for the SP500 universe:

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All good up to here except that 100% Stock Rank doesn't really make sense. With 50/50 weight it should be the average of the 2 nodes but it is not. For CEG its 99.8, but neither one of the 2 factors scores at that level. Any thoughts?

2

I think ranking works but adding the ranks of the sub-components and then reranking that sum. Every time the system ranks a factor, it normalizes the results.

1 Like
3

There is a good explanation of how the ranking works here. -
https://www.portfolio123.com/doc/side_help_item.jsp?id=29&preview=eyJhcHBfaWQiOiI0ZTgwNzQ4NiIsInRpbWVzdGFtcCI6MTY0NzQ4MzQ1OCwiY2hlY2tzdW0iOiI0NjdiYTYxNDg3Mzk0OGM1ZTY0MmZlY2NlNGRhYTgxOSJ9

4

I just dumped factors into the ranking system without even thinking about it.

5

Make sense now. I don't use a lot of composite nodes. However, it does change the way you must think about composite nodes and how to implement them in your system.