Definition: The percentage of capital not required to be deployed by the alternative strategy in order to attain a similar return profile to the fund under analysis.
Example: In the example below, a Portformer Fund analysis of American Funds American Mutual (AMFFX) returns a top alternative of iShares Core S&P 500 (IVV) with a 30.5% “lowered capital” component. This implies that only 69.5% of capital is required to be invested in IVV to attain a similar return stream as AMFFX.


Potential use cases for projected liquidity:
- Insurance policy premiums
- Pursuing alpha generating opportunities
- Debt reduction / emergency funding
- Qualified retirement distributions
- Reinvest into current allocation
How to Analyzing a Full Allocation
WATCH: Video walk-through of “Lowered Capital” component of a Portformer Fund Analysis
Capital Raising Analysis
Worksheet: https://docs.google.com/spreadsheets/d/1_Iu-DqiUIKj4pA4dElNz-xoG88NUh2gVcq2iGpxjK14/edit?usp=sharing
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[…] Explaining the Lowered Capital Component of a Portformer Fund Analysis […]
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