MONO Investment Co., Ltd. (Headquarters: Shinagawa-ku, Tokyo; Co-CEOs: Tatsu Sasaki / Ryo Nakanishi; hereinafter "the Company") announces that the paper titled "Subspace regularized principal component analysis using prior exposure information," authored by Professor Kei Nakagawa of the Graduate School of Business, Osaka Metropolitan University—technology advisor to the Company—has been accepted for publication in Finance Research Letters, an internationally recognized peer-reviewed journal in the field of finance. This research addresses a key challenge in the continuous application of PCA (Principal Component Analysis)—a widely used method in asset management and risk control—where the ordering and interpretation of factors tend to shift over time, leading to unstable and difficult-to-interpret analytical results. To resolve this, the study proposes Subspace-Regularized PCA (SR-PCA), a novel method that stabilizes the factor space (i.e., the major directions of risk factors) by incorporating economically meaningful prior exposure information. The Company will progressively integrate this research into its AI-powered factor analysis engine, "MONO FactorLens," and deliver it via its advisor-focused CRM platform "WealthForce" and through APIs for financial institutions. This enables banks, securities firms, and IFAs to understand client portfolios not merely in terms of asset class allocations, but in terms of their sensitivity to macroeconomic factors such as economic growth, interest rates, and inflation, thereby allowing clearer explanations of investment rationale and the need for portfolio reviews. Key Highlights of the Announcement - A paper co-authored by Kei Nakagawa, technology advisor to MONO Investment and Professor at Osaka Metropolitan University, has been accepted by Finance Research Letters, a globally recognized finance journal. - The study proposes SR-PCA to address the instability in factor ordering and interpretation that arises when PCA is applied