pRIVATE pORTFOLIO aNALYSIS & re-dESIGN

The Application of Physic Properties in Investing

Newton's three laws of motion, also found in "The Principia," govern how the motion of physical objects (including capital markets) change. They define the fundamental relationship between the acceleration of an object and the forces acting upon it.

• First Rule: An object will remain at rest or in a uniform state of motion unless that state is changed by an external force. 
• Second Rule: Force is equal to the change in momentum (mass times velocity) over time. In other words, the rate of change is directly proportional to the amount of force applied. 
• Third Rule: For every action in nature there is an equal and opposite reaction. 

If you agree that capital markets have "motion" than they must be subject to these three laws of physics. 

We've discovered over our 25-year actively trading in the US Equity Markets that the three primary energy forces that move markets are:

            1. Fear

            2. Delta Neutral Strategies 

            3. Greed

Bet on fear when greed is in force, you lose money.  Bet on greed when fear is heightened, you lose lots of money (Crashes). Primarily, market makers and option traders use Delta Neutral Strategies to offset capital risk.  The key to phenomenal returns is directly proportionate to your ability to identify the stages (cycles) of each energy force.  

This is by no means an easy task.   In fact, it's why most investors (private & professional) fail.  That's why it is imperative to constantly review your portfolio holdings not just for your daily P&L but for positioning opportunities in each cycle. 

Why Portfolio Analysis & Re-Design 

We know that Fundamental Analysis projects what should happen, and that Technical Analysis illustrates what did happen, and Program Trading/A.I. provides a mathematical hedge to make sure big losses don't happen.   But a well-constructed portfolio contains bullish, bearish, neutral positions as well as cash.  Most portfolios we review primarily hold only bullish positions and little cash to take advantage of changing position cycles.  Take a look at your latest statement to determine how fluid and constricted your portfolio may be.

OCM's Portfolio Analysis and Re-Design is not a simple computer program that spits-out generic beta-like (Market Index) recommendations or promotes high risk alternative investment products.

If your advisor/wealth manager has not alerted you to significant changes required in your portfolio design or allocation to prevent the next catastrophic loss, "I advise you to panic"!

(Hugh Hendry - The Acid Capitalist). 

To glean a better understanding of how OCM's Portfolio Analysis & Re-Design can save your portfolio from unnecessary loss, contact Tom Robertson to arrange a brief, no cost, initial consultation.   

You can reach us at:  trobertson@whyoasis.com  or Toll Free: 1-888-231-0775 Ext.125 .