In Part 1 of our 3 Part article titled “Creating a Powerful Blend from Scratch”, we commenced the portfolio optimization process by selecting our primary system upon which we would then apply diversification principles across instruments and asset classes to achieve a bigger bang for buck in terms of risk-weighted returns for our finite investment capital. Part 2 of this installment article focuses on how we go about this blending exercise.
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Creating a Powerful Portfolio Blend from Scratch – Part 1
In my previous article which introduced you to the world of practical portfolio management, we summarized the key criteria you need to consider when creating a portfolio from scratch. This article was theoretical in nature…..but now it is time to put the theory into practice and take you on an exciting practical journey where we apply these sound principles to create a robust portfolio performer offering sustainable risk-weighted returns.
Fund Performance Report – 31 October 2018 – “Yowzer…….we just got dumped”
October 2018 has tested the resolve of trend followers where we have suffered a similar fate to February 2018 and have witnessed a fairly nasty whipsaw in Energy, Fixed Income and Equity markets. Given that we had just caught the waves of September’s volatility surge….all our hopes for the emergence of some good enduring swells in our direction were shattered as mean reversion started to enter the mix as markets rebounded sharply from their maximum adverse excursions resulting in some crazy double-up formations and some spectacular wipe-outs.
Smoother than the Sum of its Parts – An Approach to Portfolio Optimization
What portfolio management is all about is to engage in a systematic method of constructing a portfolio of investments from ground up that utilises principles of risk management at all steps along the way to achieve an optimal risk-return profile.
Fund Performance Report – 30 September 2018 – “The Swells are Building”
September 2018 saw the re-emergence of volatility in the equity markets with an ensuing decline in the S&P 500 TR Index (includes dividends) of 6.83% for the month. Does this small blip in an otherwise linear ascent in the Index since January 2009 signal further volatility ahead….or like February 2018, will we see a return to the progressive surge of the Index to new highs?
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