[William]

Hi Alex,

Having some further thoughts on this: just using an example if I had a 100k account and my broker provides 200% leverage on stocks…can I invest in 100k worth of MYRS and 100k in something very safe like your Bond Rotation strategy?

This way i wouldnt be overexposed to one particular strategy but would jointly be benefitting and gaining from the protection and income generated by the Bond portfolio?

Is it a cheap way to effectively double my portfolio and my returns but without doubling my risk?

I am considering to additionally subscribe to this strategy as a complimentary less volatile addition to MYRS.

Many Thanks in Advance,

Will

[William]

Thanks Alex I think I will halve my capital allocation to MYRS but then use the 2x leverage provided so that my exposure is the same even though as you say I will be 2x volatile. But this way I can achieve similar returns whilst using my freed up capital for another strategy? Any issues with this you think?

[William]

SO if there is an unprecedented Black Swan event they can terminate ZIV right at the bottom of its value and we crystallise a huge loss right at the moment it would probably be great to jump into ZIV?

Would this have happenned to ZIV if it existed on Black Monday and/or 2008?

[William]

Thanks and assuming TMF retains its inverse correlation to ZIV I shouldnt be too concerned if I have managed to catch the top of a bull market? Will MYRS perform well in a Bear market?

[William]

Hi Please can I ask another question.

If I am adding capital to this strategy a bit at a time each month I would effectively be scaling into and averaging into the prices of ZIV and TMF. Is this a problem for this strategy? Is it balanced in a way that it becomes unbalanced if I am averaging in capital?

Also I only just started this strategy 6 days ago and I wonder if there is a timing issue with startign this strategy as i seem to have caught what appears to me as a peak in the value of ZIV and the SP500…

Thank you!

[William]

Great explanation much appreciated!

[William]

Thanks Alexander. As a basic rule of thumb are you inverse MT Vix Futures curve whenever it isnt in backwardation? and do you ignore the front month contango readings?

As a rule of thumb what % of the time is the MT curve in contango?

Which brings me to another query I had out of interest which is why you prefer ZIV to XIV? Is it because it is more stable and requires less frequent management? XIV/TMF correlations as far back as data available seem relatively similar to ZIV/TMF except XIV runs about double the growth to ZIV in periods of low volatility. Short VXX seems even higher.

[William]

Thank you Frank. Good to know that it is because of quick yoyo action in the markets which are not “time-able” events anyway. So despite unpredictable extreme volatility the strategy still held its own and didnt lose out. Good.

[Author]

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