Set factor exposure bounds

Use Factor exposure bounds in Constraints to limit an optimized portfolio’s exposure to an asset-class type or a custom factor. You can set these bounds in the app for an account, model, or firm. An exposure bound controls the weighted exposure across holdings; an asset bound controls one ticker’s weight.

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1. Open Constraints at the intended scope

On a client page, select a named account rather than All accounts to see Setup. Scroll to Factor exposure bounds in the Constraints editor. Check the inherited values before editing. A non-empty account factor-bound list replaces the model or firm’s list as a whole. A model list replaces the firm’s list. Keep the factors you still need when creating a more specific list.

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2. Add a factor and its bounds

Click Add factor bound and enter the exact factor name in Factor. For equity exposure, use asset_allocation_equity. Tilt also supplies allocation factors for fixed income, commodity, currency, alternative, cash, private equity, crypto, and unknown exposure. The built-in factor reference lists their exact names and data requirements. Enter a number in each of the four bound fields. This illustrative equity range allows 50% to 70% absolute exposure and a difference of −3 to +3 percentage points from the optimization benchmark: Both ranges apply together. With 60% benchmark equity exposure, the illustrative active range permits 57% to 63% equity exposure, which also falls within the absolute range. Choose ranges that fit your mandate and the account’s other constraints. Use the optimization benchmark for the active comparison. A monitoring policy can use a different benchmark; Models and benchmarks explains the references.

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Use an existing custom factor

Enter the exact name of a custom factor already configured for your organization. Confirm its availability, loading scale, and direction with the Tilt team before setting bounds. Adding its name in this editor does not create the factor or its asset loadings. Custom-factor upload is in development. The API guide documents the upload format and replacement behavior for that work. Contact the team to request a factor while self-service upload is in development. Monitoring’s Size factor does not establish optimizer compatibility. Large-cap, mid-cap, and small-cap buckets require defined custom loadings; the built-in allocation factors do not include those buckets. A continuous Size score and a percentage allocation to a bucket measure different things. See Size and capitalization buckets. Contact the Tilt team for another Tilt-supplied factor or help defining custom loadings. Include the exposure definition, units, asset universe, intended ranges, and active benchmark. Request a new factor lists the details to send.

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3. Review and apply the change

For an account or model, click Queue changes to close the editor. Firm edits queue as you make valid changes. Open Queued changes, check the target scope and complete factor-bound list, then click Apply to save or Discard all to abandon the draft. Reopen Constraints after saving and confirm the factor names and bounds. On an account or model, use Use the inherited bounds to return to the broader scope’s list, then queue and apply that change. Removing the last local factor row also restores inheritance; check the resulting list before applying.

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4. Optimize and inspect the proposal

After applying account changes, open the account’s Optimization tab and run Optimize. Saving bounds changes optimization inputs. It does not run optimization or place trades. Inspect the proposed holdings and factor exposures against both ranges. If the run is infeasible, review the absolute and active limits together with cash requirements, position limits, and trading restrictions. How optimization makes tradeoffs explains their interaction; Review a rebalance covers reviewing the resulting proposal. For exposure alerts and oversight policies, use Manage monitoring policies.