While our portfolios have retraced over the past 1-2 months due to many futures markets shifting trends and moderating volatility, the ACubed portfolios are still doing what they’re designed to do… add substantial diversification to stock and bond portfolios!
As you can see, the typical 60/40 mix of stocks and bonds performed its worst since 1976, a return of -16.1% for the first half of 2022. ACubed portfolios compare well against this:
Micro Portfolio
The Micro portfolio closed June 2022 with the following results:
The portfolio has underperformed recently, however the profitable trend remains in tact and we’re looking for a return to profitable performance in the coming months:
100k Portfolio
The 100k portfolio closed June 2022 with the following results:
The portfolio has underperformed recently, however the profitable trend remains in tact and we’re looking for a return to profitable performance in the coming months:
Mothership Portfolio
The Mothership portfolio closed June 2022 with the following results:
The portfolio has underperformed recently, however the profitable trend remains in tact and we’re looking for a return to profitable performance in the coming months:
Portfolio Updates
We’ve passed our first drawdown threshold and have reduced heat whilst in these current market conditions to stem the bleeding. In addition, we’re completing our regular risk review and implementing additional risk management levels as drawdown may occur and even as monthly returns perform significantly better than expected.
After working on this for over a year, we have implemented a way to avoid trading each strategy in its worst market conditions. Because each strategy will tend to have fewer trades each year, this will also allow us to add more strategies to each portfolio over time, increasing the diversification of each portfolio.
Closing Comments
One of the most challenging aspects of transitioning from an 8-to-5 job with predictable payday to Full-Time Trading is the market’s indifference to what we want or expect. Changing trends and volatility in the markets produce losing days, weeks and months despite our best efforts to have consistent wins and minimal losses.
This requires a paradigm shift: recognizing that watching tick-by-tick changes in your portfolio is maddening. Instead, we need a 30-thousand-foot viewpoint where we define success by Quarters or longer time periods.
This viewpoint accounts for the normal (negative) statistical variations in positive expectancy portfolios. At the same time, it challenges us to look deeper into market dynamics to uncover or confirm consistent statistical edges, identify conditions that are unfavorable to strategy methodologies, and to creatively adapt to markets that rhyme but never behave exactly the same.
ACubed Trading portfolios continue to show lower-left to upper-right equity trends as we examine performance over the past Quarter and Year. Rather than resting on our laurels, we are dedicated to keeping a watchful eye on individual strategy performance as well as adapting our strategies as market edges come and go.
We accept that drawdowns will occur but continue to develop new techniques to mitigate the duration and extent of these drawdowns for our clients and ourselves.
Bring on the recovery!
The ACubed Trading Team.