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Macro Trading Strategy

Our trading philosophy is designed to capture key events with plenty of movement potential, whether upwards or downwards, by trading option contracts on both developed and emerging market assets. A contrarian approach is used to place trades on business, economic and political events globally. In short, our trading philosophy is to offer independent and original thinking by using a contrarian or an ‘against the crowd’ type approach. Note that this does not mean we are going against the crowd at all times, since psychological and social factors play an important role in the determination of market prices. It just means that we try to predict when prices will turn, either up or down, before the crowd does.

Eclectic or Mixed

The trading strategy is by definition ‘eclectic or mixed’ – lying at the intersection of various strategies such as macro, fundamental, contrarian and event driven. Predicting political events and behavioral aspects (psychology and sociology) of the market is a source of potentially very high returns (called ‘alpha’ in the investment industry).

Exceptional Returns on a Per Trade Basis

Our trading strategy is focused on finding very favorable trading opportunities, which result in exceptional returns on a per trade basis. Returns of greater than 100% and sometimes over 500% per trade are targeted depending on the opportunity. As such, trading does not occur frequently, but when significant opportunities are present. This trading strategy lends itself naturally to capital preservation, since a good portion of the funds can be invested in short-term fixed income instruments, most of time.

Target Return is 50% Plus

The target return is 50% plus on an annualized basis, with two benefits – reduced risk and lower trading costs. Risk is minimized through the careful selection of specific types of option contracts and by sticking to strict money management rules.

Most of the trades are carried out by buying option contracts on highly liquid assets such as large cap stocks, indices and Exchange Traded Funds (ETFs). During times of financial crises, these types of assets offer higher liquidity allowing one to get in and out of trades quicker. Thus, the ability to move relatively quickly under all market conditions plays an important role in deciding which assets (particular stocks or companies) we recommend trading.

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