Equal-weight allocation

Calculation contract

w_i = 1 / N

Method and interpretation

The rule contains no return estimates. That makes its arithmetic easy to inspect, but the universe is still a substantive choice. Four assets receive one quarter each; splitting one economic exposure into two tickers would change the resulting economic allocation.

The output is a target vector, not a trade list. To implement it, first map the ordered assets, identify drifted holdings and decide when and how to rebalance. The turnover reference can measure an already aligned before-and-after comparison.

Where the reference stops

Equal capital does not imply equal contribution to volatility or equal exposure to common factors. The card deliberately does not infer missing assets, cash, leverage, execution prices or costs. A passing arithmetic test says nothing about the merits of the chosen universe.

Published synthetic inputs

{
  "assets": 4
}

Frozen calculation output

{
  "weights": [
    0.25,
    0.25,
    0.25,
    0.25
  ],
  "weight_sum": 1
}

No expected returns or covariance inputs. Rebalancing costs and universe selection are outside the rule.

Verification coverage

• Every weight is nonnegative; weights sum to one within floating-point tolerance.
• Two, four and fifty assets; fractional, missing and oversized counts rejected.

Unit and independent-reference checks test arithmetic and rejection rules, not future investment performance.

Method references

• MOSEK: portfolio variance and allocation constraints

Read the assumptions in context