Single Index Model (SIM)

The single index model (SIM) is based on the modern portfolio theory (MPT). By basing results on a single influencing factor, SIM offers a simpler and less data-intense investment model than MPT.

The SIM is used primarily in the asset allocation process. Compared to other more comprehensive models, this model is more time efficient and calculations are less complex. It is often used in combination with other investment management models. 

More information:
Swiss Trading comparison tool
Asset allocation
Capital Asset Pricing Model (CAPM)
Modern Portfolio Theory (MPT)
Perfect Capital Market
Arbitrage Pricing Theory
Using Fractals To Invest Successfully

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Expert Benjamin Manz
Benjamin Manz is CEO of and an independent expert on banking and finance.