Investment Strategy
How Luum Wealth generates your AI Investment Strategy: projections, peer benchmarking, and diagnostics.
Wealth tier
Refreshed weekly · AI-generated
The Investment Strategy page is Luum's most powerful feature — a comprehensive, AI-generated analysis of your entire portfolio with quantitative diagnostics, forward projections, and peer benchmarking. It's designed to answer one question: am I on track, and where should I focus?
Educational use only. The Strategy page is an analytical and educational tool. The AI narrative, projections, and observations are informational only. They do not constitute personalised investment advice, a suitability assessment, or a trade directive.
What's on the Strategy page
AI Investment Summary
Claude AI reads your real portfolio data — allocations, risk metrics, performance, fees, and income — and writes a plain-English strategy narrative. The AI is grounded in your actual numbers; it cannot invent figures. The summary updates weekly and can be refreshed on demand (uses 5 AI answers).
Risk & Concentration Diagnostics
The page quantifies your blended risk using a composite of beta, volatility, and max drawdown across all your portfolios. Concentration is measured using the Herfindahl-Hirschman Index (HHI) across four dimensions: asset class, sector, geography, and individual holding. Each dimension gets a 0–100 concentration score (higher = more concentrated = higher risk).
Fees & MER Drag
For each ETF you hold, Luum retrieves the real management expense ratio (MER) from EODHD data and calculates the compounded fee drag over 10, 20, and 30 years. Blended portfolio MER is shown alongside peer cohort averages.
ETF Look-Through
For ETFs with known holdings (via EODHD), Luum “looks through” to the underlying securities. This powers:
- A two-ring sunburst chart showing ETF → underlying sector allocation
- Pairwise overlap detection between ETFs you hold (Rüschendorf coefficient)
- Home-country bias vs. the MSCI ACWI 3.5% Canada weight benchmark
Monte Carlo Projections
Luum runs 10,000 simulated portfolio paths using Geometric Brownian Motion (GBM) with Cholesky-correlated asset class returns. Capital market assumptions are sourced from J.P. Morgan's Long-Term Capital Market Assumptions (LTCMA), refreshed annually. The result is a fan chart showing your p10, p50, and p90 outcomes over your investment horizon, adjusted for inflation (Statistics Canada CPI for Canadian users, US CPI for US users).
Peer Cohort Benchmarking
Your portfolio metrics are compared against anonymised aggregates of Luum users with similar risk profiles, investment goals, and time horizons. Metrics include: daily-chained YTD return, blended MER, concentration score, and allocation breakdown.
Performance vs. Market
Your blended cross-portfolio holding-period return is compared to the S&P 500 over 1M, 3M, YTD, and 1Y periods.
On-Track / At-Risk gauge
Based on your goal (retirement date, target amount) and current trajectory (median Monte Carlo outcome), the page shows whether you are On Track, At Risk, or Off Track — with an estimated gap in today's dollars.
How often does it update?
The AI narrative generates once per week (Sunday night). Monte Carlo simulations run on the same schedule. You can trigger a manual refresh at any time using the Refresh AI button (costs 5 answers).
Questions?
Email us at support@luumwealth.com or use the in-app Help Centre.
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