Portfolio Strategy
ARIA
Walk-forwardAdaptive Risk Investment Allocation
- Rebalancing
- Monthly
- Universe
- 5 ETFs
- As of
- ...
Backtest 2010 to present. Walk-forward test active since April 1, 2026.
The Strategy
ARIA (Adaptive Risk Investment Allocation) manages risk independently across four equity segments: US large cap, US technology, US small cap, and international developed markets. Each segment is assessed on its own, and when conditions for a segment deteriorate, that position moves to cash while the others can stay invested.
The result is a portfolio that scales down total equity exposure as aggregate risk rises and scales back up when conditions are favorable. Rather than an all-or-nothing equity call, it can hold one or two segments while stepping out of others. The model is fully rules-based with no discretionary input.
Walk-Forward Test Active Starting April 1, 2026, this strategy is being tested with market data in a walk-forward framework. All historical data before this date represents backtested performance.
How It Works
At each month-end, ARIA re-assesses each equity segment with a quantitative model and sets each one to invested or cash for the month ahead.
The dashboard displays both backtested and walk-forward performance. The shaded area marks April 1, 2026, the start of the walk-forward test. Data to the left is historical backtesting; data to the right is hypothetical out-of-sample performance.
Simulation Settings
Set your start date and initial capital. ARIA applies independent risk management across four equity segments with monthly rebalancing.
Model Performance
Drawdown
Peak-to-trough declineEquity Exposure
Total equity allocation over timeCurrent Positions
Walk-Forward Test
ARIA vs SPY Buy & Hold
Full backtest period comparison:
| Metric | ARIA | SPY B&H |
|---|---|---|
| Total Return | -- | -- |
| CAGR | -- | -- |
| Volatility | -- | -- |
| Sharpe Ratio | -- | -- |
| Max Drawdown | -- | -- |
| Exposure | -- | 100% |
Crisis Performance
Strategy behavior during major market downturns:
| Crisis | ARIA | SPY |
|---|---|---|
| 2020 Covid | -- | -34% |
| 2022 Bear | -- | -25% |
Detailed Metrics
Strategy Health Monitor
Live drift detection and alpha decay tracking
Drift Detection
Detects structural shifts in performance
Alpha Decay Monitor
Risk-adjusted return, 12 vs 36 months
The left panel flags structural shifts in performance against expectations. The right panel compares recent risk-adjusted returns with the longer-run track record. A weakening trend points to a fading edge.
Statistical Validation
Before deployment, ARIA was validated with a battery of standard statistical robustness tests. All tests used the fixed production strategy without post-hoc parameter tuning.
10,000 random position sequences with identical average market exposure. Only 1 in 10,000 matched the observed risk-adjusted return.
10,000 bootstrap samples produce a 95% confidence interval for the Sharpe ratio entirely above zero.
Every out-of-sample split produced a positive Sharpe ratio, with a median of 1.60.
Statistically significant alpha (t > 2.0) against all six benchmarks tested: buy-and-hold, balanced 60/40, equal weight, inverse volatility, momentum, and trend following.
CVaR (95th percentile) is −4.7% per month, compared to −8.6% for SPY. Worst observed month since 2010 was −7.4%.
Inputs are processed to prevent look-ahead bias, so backtested and live results stay directly comparable.
All tests conducted on the fixed production strategy. Past statistical performance does not guarantee future results.