The Logical-Invest monthly newsletter for July 2015

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This is the monthly monthly Logical-Invest newsletter for July 2015. 

Strategy performance overview:

symbolcloseyear to date % ▴3 month %1 month %1 day %60 day volatility60 day correlation3 month Sharpe12 month Sharpe36 month Sharpe

BRS – Bond Rotation Strategy
BUGST – A conservative Permanent Portfolio Strategy
BUGLEV – A leveraged Permanent Portfolio Strategy
GMRS – Global Market Rotation Strategy
GMRSE – Global Market Rotation Strategy Enhanced
WORLD-TOP4 – The Top 4 World Country Strategy
UIS – Universal Investment Strategy
UIS-SPXL-TMF – 3x leveraged Universal Investment Strategy
AGG – iShares Core Total US Bond (4-5yr)
SPY – SPDR S&P 500 Index
TLT – iShares Barclays Long-Term Trsry (15-18yr)

Market comment:

Global equity markets sold off these last days of June because of Greece “Grexit” fears. Unfortunately these last two days have been enough to change the positive monthly performance of most strategies into a negative one. For June, most asset classes like U.S. equity, foreign equity, treasuries and gold, all had negative performances. This is a rare situation. Normally at least one asset class goes up.
This year, best strategies have been the World-Top4 and the MYRS strategy. There are still booming single countries, and ZIV still collects about 2% roll yield per month, even if the market goes sideways or slightly down. These two strategies are followed by equity strategies like, Global Market Rotation, low volatility Global Sector Rotation and UIS.
Worst performers have been strategies which are heavily invested in bonds, like BRS, and the two BUG strategies. Bond allocations in most strategies have been reduced, although maintaining some exposure is an important insurance policy should unexpected events occur.
There will probably still be some additional volatility ahead of us, at least until we know what happens with Greece. Most analysts believe that “contagion” risk around the Greece situation may be limited as Greece poses little systemic risk. The market (and economies) of Europe are in much better shape today than they were in 2011 or 2012.
Knowing that these volatility spikes normally quickly mean revert to normal levels, I would use them to profit from the lower ZIV price and invest more capital in MYRS and not increase bond strategies exposure for now.
In evaluating between the asset classes of equities, bonds and precious metals, I think for the moment, equities have the strongest trends and are still the best choice.

Frank Grossmann
July 2015

2017-10-02T20:00:00+00:00 By |0 Comments

About the Author:

Frank studied Microtechnics at the Federal Institute of Technology in Lausanne and Business Administration at the Federal Institute of Technology in Zurich. After the Studies in 1989 he founded Labocontrol AG. Labocontrol developed high speed film scanners used in most of the photo labs for the production of Photo CD's. In 2000 Labocontrol was sold to Digital Now and Frank worked as Chief Scientist and later CTO of this Company. In Mai 2002 Frank founded Colour-Science AG a company specialized in image processing algorithms like face detection or red eye removal. Many of these algorithms could be also used to search for pattern in financial data, so Frank began to develop and back test rule based investment strategies. The main focus was to find strategies, which would allow a positive return also during a financial downturn or major financial crash.Based on this research, logical-invest developed some very successful strategies and due to its solid performance and positive returns, we decided to share our knowledge with you and publish it on a monthly basis through "rent-a-strategy".

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