That time of the month…..
I am changing the format of reporting from this month onwards. The numbers reported will be based on how the combined portfolio does in a non-IRA account across the recommended 3 strategies. For those of you who don’t know what that means, please see the video I had put up earlier in the month.
2020 – 57.5%
YTD for 2021 – We are down by around 0.1%
For March, we were up by 2.48%
I have discontinued the RP – Futures strategy and the RP – Silver strategies. The futures strategy because the platform that we use lost a legal case as a result of which there were liquidity constraints on futures which in turn led to trades not being mirrored correctly in the subscriber accounts. The silver strategy was discontinued because I had just one client on it and it was costing more to keep it running.
2021 Performance Statistics
Monthly Performance RP – Platinum
Monthly Performance RP – Swing
The annual returns are cumulative, not additive. You need to multiply the returns of each month and not add them up.
Weather Conditions and Looking Forward
The analogy of the lanes and the vehicles we use to drive on those lanes works well, so I am going to continue using that analogy to describe what the market conditions are and what to expect going forward.
The Risk Parity Platinum model uses both fundamental and technical indicators to determine its changing of lanes between stocks, bonds, gold and cash. This month it reduced its exposure to stocks further and increased allocation to gold and bonds. It continues to expect the stock market to crash in the coming weeks and months and is placing a higher bet on inflation and hence gold. Allocation to cash continues to be around 40%
The Risk Parity Swing model on the other hand does not look at fundamental indicators at all and primarily determines its allocation based on technical indicators. Since it is a “sports car” compared to the Risk Parity Platinum which is a “mini-van”, the model can afford to do that…since it depends on maneuvering its way out of traffic jams. Allocation is primarily to stocks and bitcoin.
The Day Trading model does not look at fundamental indicators either. It is a probability based model which enters the market when the trade has a reasonable probability of success. Goes both long and short and hence is not suitable for IRA accounts. Designed to be used primarily with margin money. This one makes no pretense to understand the direction of the stock market in the coming weeks or months. It operates in the minutes and hours timeframe.
The two models combined seems to provide for a better return-risk profile since the diversification is now not just on lanes (by diversifying across stocks, bonds, gold and bitcoin) but also on the vehicle being used to drive on those lanes. (the min-van, the sports car and the bike). If you still don’t understand what I am talking about, please see the video I referred to earlier in this blog post.
