How to Analyse a Popular Investor’s Performance for In-Depth Information With piScreener
December 26, 2023
eToro provides a great platform with social trading features through the Popular Investor (PI) programme. And with thousands of PIs to choose from, the challenge becomes choosing one that is right for you. Overcoming the challenge will require advanced tools that can perform an in-depth analysis of each PI’s performance. That is what piScreener offers you through an easy-to-use app that is free to use.
You will get the basic information need to know about a potential PI on eToro, but you may need additional data to refine your search toward the best choice. It is important to perform this in-depth analysis with additional features beyond what eToro provides. Not only will this help you make a better choice, but also increase the performance of your portfolio.
Consider the research conducted by Vanda Research and published on Bloomberg, showing that the average active amateur investor’s portfolio fell by about 30% in 2022. It showed that although retail investors now have access to the markets, there’s still a gap in the value of data they receive regarding assets. We created piScreener to help close this gap and help our users increase the performance of their portfolios.
How the Popular Investor (PI) Programme Works
Social trading is not a new concept in cyber trading. In fact, you might argue that traders/investors have always shared information ever since financial markets were created. The internet then made it possible for ‘outsiders’ to access the same markets and discuss through blogs (such as this one), internet forums, and even social media platforms.
Then social trading platforms such as eToro revolutionised the industry, allowing traders to automatically copy trades through their trading platforms without having to place the orders themselves. This allowed amateur traders to replicate the performance of seasoned experts thus achieving better results.
Among these platforms, eToro emerged as the winner having over 20 million registered users. Any one of them can apply to the Popular Investor programme provided they meet all the criteria. Once approved, any registered eToro member can view the PI’s portfolio and various analyses such as the:
allocation of assets in the portfolio by class and sector,
frequently traded assets,
performance by month/year,
value of assets under copy (AUC),
average risk score,
number of copiers, etc.
With this information, you can then decide whether you would like to copy the PI’s trades and allocate a portion of your capital. You are also allowed to copy multiple PIs and allocate varying amounts of capital, which means you can tailor your portfolio to meet your investment goals.
What piScreener Adds
All the above are useful features, no doubt, but you can see that you’re only getting the most basic information. The best investors find more in-depth information before making any investment decisions, which is why they are more successful and often beat the market.
To get an insight into a PI’s decision-making, piScreener provides additional features that will help you select a PI that has similarly aligned goals to yours using:
annualised returns to show cumulative returns
Sharpe ratio to calculate returns vs. risk and volatility
standard deviation indicating how far performance was compared to expectations
alpha comparing actual performance vs. a selected benchmark
beta measuring volatility against overall market returns
As you can see, there is a lot more information about a PI’s portfolio to be glimpsed through piScreener. This will be important in finding more information about the portfolio’s performance, and assessing how it compares to your own targets.
Another important feature of piScreener is the ability to compare portfolios so that you can pick one or another. eToro does not provide this feature despite how important it is, which makes piScreener all the more valuable for a trader.
How to Use piScreener for Beginners
We have made piScreener easy to use so that anyone can enjoy its benefits, and you can start using it in 3 steps:
Step 1: Create a piScreener account
Although this is optional, it will increase the things you can do with piScreener. After clicking on the ‘Go to App’ button on the website, you will be redirected to the piScreener app where you will be asked to create an account. You can do so using a Google account signed in on your browser for automatic registration or create one using your email and chosen password.
Either way, your account should be ready for use once the details have been provided. In case you have any difficulties, reach out to us by filling up this Google Form and we will contact you for further assistance.
Step 2: Create a Portfolio
All simulations are performed as portfolios, allowing you to check the performance of a single PI or multiple PIs, since it’s possible to copy several PIs on eToro simultaneously. To create your first portfolio, click on the ‘Manage portfolios’ tab on the left menu and click on ‘Create new portfolio’.
Enter the name you want to assign the portfolio and click on ‘Insert’. Now you can type in the usernames of one or multiple eToro PIs that you want to include in your portfolio. The PI’s username can be found on their eToro profile just below their account name.
After adding your PI(s), click on ‘Save portfolio’ to add it to your account.
PS: You are currently limited to creating 3 portfolios, but this will be expanded in the future.
Step 3: Simulate Your Portfolio
With your portfolio ready, click on ‘Simulate your PI portfolio’ and scroll down the page to the ‘Select a portfolio’ section. Here, you can load the saved portfolio listing all the PI(s) added, the amounts of capital allocated to each, and the currency. Proceed by clicking on ‘Update’.
If no benchmark had been selected, the selected portfolio will be compared to the S&P 500 for analysis, such as in this case. The results of the analysis will be displayed on the same page showing you how they compare.
Above you can see that the selected portfolio outperformed the S&P500 index. And there are many other metrics you can view about the portfolio further down the page such as the risk, Sharpe ratio, annual returns, standard deviation, correlation, asset allocation, etc.
This article is a beginner’s guide on how you can use piScreener to analyse a PI’s portfolio and compare its performance to that of other PIs or benchmarks. There is a lot more you can do with piScreener beyond this, and we will be discussing these applications in future blogs. So stay tuned to find out how you can increase your performance using piScreener and improve your trading game.