Another newbie question

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Another newbie question 2017-07-14T15:48:39+00:00
  • Author
  • rio chang
    Post count: 5

    Would it be ok to change the meta strategy each time we do rebalance based on how good or bad each strategies does for the previous month?
    for example, if this month I am running a combination of 25% nasqad100 / 25% 3xUIS / 25% MYRS / 25% BRS for my meta strategy, however since Tesla got a big hit and lost 14% this month, should I change the nasqad100 % allocation or even swap to other strategy next month based on the performance?

    Or should I keep exactly the same strategy and allocation to avoid “buy high sell low” situation?


  • Frank Grossmann
    Post count: 131

    No, I don’t think it makes sense to change the meta strategy allocation each month. The problem is that if you would for example change from the Nasdaq 100 strategy to a safer strategy like Bond Rotation, then you profit only half if there is a recovery. It’s like selling half of your Nasdaq100 allocation and go to cash. This means that you realize a loss with no chance to recovery. The Nasdaq 100 strategy had a lot of such one month draw downs but it had even more really big monthly gains with single stocks surging 20% or more.
    However due to the high valuation of the Nasdaq100 and the normally underperforming summer period I would not invest too much in the Nasdaq100.

  • rio chang
    Post count: 5

    Thank you for your clarification and advise!

    1 user thanked author for this post.
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