FAQ

Most frequent questions and answers

Yes, we believe in having skin in the game and almost all our liquid net worth is in our own strategies.

None of our strategies would work if there weren’t periods of under-performance. If it’s too good to be true, it either isn’t true or it’ll get arbitraged away very quickly.

Looking different from the crowd is a lot of fun when the market is falling and we’re not. But there have been, and will continue to be, times when we’re going nowhere and the market is ripping higher. Sticking with the system in that scenario is what rewards us in the long term. Easier said than done. Look at the base rates section for each strategy for more details.

That’s the golden question! There are deep-rooted reasons for why we think our strategies will continue to beat passive investing:

Our strategies successfully navigated 3 major downturns and a variety of market environments over the past 20 some years. Using synthetic data and some assumptions, our strategies have performed in-line with expectations all the way back to 1968!

We incorporate a broad set of globally-diversified asset classes. This captures true diversification, especially in times of crisis.

We tactically choose between all asset classes using proven factors like momentum. This helps us avoid deep-drawdowns that are common in passive investing.

We make sure not to overfit our strategies to ‘game’ backtests. We use an ensemble of simple models to combine many small edges to capture long-term outperformance.

Since going live in mid-2018, our strategies have continued to perform in-line with expectations. They have successfully avoided the COVID-19 downturn generating huge out-performance in the process.

Because we run tactical strategies, we don’t hold long-term positions in bonds. If interest rates start rising, our strategies will lower allocation to bonds and/or shift to cash.

We’ve run many ‘what-if’ scenarios on the performance of our strategies in a rising interest rate environment. See: here for a similar analysis.

Leveraged funds are maligned for being too risky or suffering too much from volatility decay. The truth is, when used in a broad diversified, cross asset class strategy such as ours, they’re great for scaling risk exposure up and down.

We offer many flavors of our strategies depending on risk tolerance. Subscribers can choose from the non-leveraged version (Conservative) and the leveraged version (Aggressive) of our strategies.

The cross asset momentum and dynamic rebalance strategies usually trade on the last trading day of the month. The tactical volatility strategy and the combined alpha strategy trade more frequently, but no more than 3-4 times a month usually.

In times of market turmoil, a strategy might trade more often though. Every day, we email the strategy signals to you in the morning before noon Eastern Time. We recommend buying/selling the same day at or near the close. See here for how to trade.

Each strategy signal is valid for the day it is sent, so if you skipped a day or were late, just follow the next days signal.

It takes between 5-10 minutes to put on all our trades. In times of market turmoil, the strategies may trade intra-month more often. We think putting in the time to trade more actively is a worthy tradeoff for long-term out-performance.

Yes. As most of our strategies are high turnover, following them in a tax-advantaged/tax-deferred account like an IRA, Roth IRA and certain 401(k)’s would yield the best after-tax results. Similar concepts apply for other countries.

Some retirement accounts have limited fund selection. We can work with subscribers on substituting funds that work best for our strategies. Contact us for details.

We are not tax professionals and you should consult a tax attorney for tax advice. With that caveat, we don’t let the tax tail wag the dog :). Even though most of our strategies are high turnover resulting in short term capital gains (taxed as ordinary income), the after-tax performance still clearly beats our passive benchmarks.

There are, however, ways of getting favorable tax treatment in taxable accounts by using instruments like future contracts. Contact us for more information.

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