How Openbook scores stocks and portfolios.

The Reward Score

The Reward Score is a weighted average of four factor scores, each on a 0–100 scale. Higher means the current inputs produced a stronger model reading, not higher expected returns. The factor weights are fixed across the equity model at a 40/25/20/15 split, with Growth carrying the greatest weight.

The model is not wholly absolute. Gross and net margins in Profitability are compared with sector averages. P/E, EV / EBITDA, and EV / revenue in Valuation are also compared with sector averages; configured defaults are used when a supplied sector average is unavailable. Missing inputs can be omitted, reweighted, or replaced by neutral or documented fallback values depending on the factor, so this page is a guide rather than a reproducible calculation trace.

The Risk Score (equity)

The Risk Score starts as a weighted average of four factors on a 0–100 scale, with lower values representing lower modelled risk. Volatility carries the largest weight, followed by Financial Solvency, Operational Quality, and Size.

When the volatility factor is measured, a floor is applied after the weighted average: a volatility factor of at least 55, 70, or 85 prevents the headline Risk Score from falling below 45, 56, or 72 respectively. No floor is applied merely because missing volatility data left the factor at its neutral default.

Portfolio scores

Portfolio-level Reward and Risk are not just averages of the stock scores. The Reward Score aggregates each holding's growth, momentum, profitability, and valuation factors using current position weights. The Risk Score is built differently because an average of stock-level risks does not represent concentration or shared sector exposure, so the portfolio Risk Score uses four structural factors instead.

Portfolio Reward Score

For each of the four reward factors (Growth, Momentum, Profitability, Valuation), we take the position-weighted average of each holding's score on that factor. We then blend those four with the same 40/25/20/15 weights used at the stock level. The result is interpretable as "the average reward profile of the portfolio, weighted by how much money you have in each position."

Portfolio Risk Score

The portfolio Risk Score uses a different factor model than the equity Risk Score because portfolio risk is structural, not aggregated.

The Concentration and Sector Concentration factors use the Herfindahl-Hirschman index (HHI), a standard measure of concentration. We normalise the HHI between its theoretical minimum (perfectly equal weights across N holdings, 1/N) and its maximum (a single position, 1.0), then map the result to a 0–100 risk score.

Data availability and update behaviour

• Stock-level scores are recomputed from the latest inputs delivered to the equity page. Inputs can arrive on different schedules, and the scores are not represented as real-time. Use a page-level data timestamp where one is shown.
• Portfolio scores use the current holdings, position weights, and available stock-level factor scores when the portfolio analytics calculation runs.
• Price inputs use the most recent observations available to the model. Quote fields, price histories, and benchmark series can have different effective timestamps.
• Fundamentals use the annual or quarterly statement records currently available to the application. Coverage and reporting periods vary by company.
• Analyst estimates and targets are used only when supplied by the upstream data provider. Availability and freshness vary by company and metric.

What we cover today

• UK-listed equities. Scores can be available for more than 1,500 UK-listed companies with sufficient reporting history. Availability for an individual company depends on the financial and market inputs supplied to the model.
• US-listed equities. Equity pages cover major US exchanges, while Reward and Risk score availability varies by ticker and remains in beta.
• UK and US-listed ETFs. ETF pages can contain holdings, exposure, cost, and other available fields. This equity methodology does not imply that every ETF has an equity-style Reward or Risk score.

Known limitations

The current methodology has important limitations:

• US factor scoring is incomplete. Some US tickers do not yet carry a Reward or Risk score. We display blanks rather than estimates in those cases.
• Sector classifications are imperfect for conglomerates and special situations. A holding company sitting across three sectors will be assigned the parent's primary sector, which may understate sector concentration in the portfolio score.
• Correlation risk uses a sector proxy, not returns-based correlation. The current portfolio implementation approximates co-movement through same-sector pair density rather than pairwise return correlations.
• Missing data affects the result. Depending on the factor, unavailable metrics can be omitted and remaining inputs reweighted, or a neutral or fallback value can be used. A score should be read alongside its available inputs and any confidence information displayed.
• The scores are model output, not analyst opinion. A higher Reward Score does not mean an analyst expects the stock to outperform. It means the available inputs mapped to stronger bands under the current model. Commentary in Insights is separate from the score.
• Historical comparisons may span model or data revisions. Treat score-trend annotations as indicative unless the page identifies the compared values as contemporaneous snapshots produced under the same version.

Versioning

Material changes to this public methodology are dated and versioned here. Historical scores or comparisons may have been produced with earlier model logic or data and should not be assumed to be directly reproducible under the current implementation.

Questions