Barry Gibb of the Bee Gees once said “all bubbles have a way of bursting or being deflated in the end”. I suppose he would know. With the Winklevoss twins crushing it with their beloved gravity-defying Bitcoin (BTC futures contract is up a whopping 673% since March 2020 lows) and the Nasdaq-100 index cresting an all-time high of 13,000 on Friday (NQ has doubled during that same period), what gives? Add a Capitol Hill invasion, continued COVID uncertainty and mere days away from a new U.S. President at the helm and some would believe that we’re witnessing yet another cluster of financial bubbles irrationally and exuberantly inflating. Is anyone concerned? We certainly are not; we make every effort to avoid forming opinions about market direction, timing, etc. Our trading models are designed to not only weather selloffs, but also profit by simply reacting to the data in either direction.
On January 1, we launched two additional strategies in Collective 2: Adagio and, as discussed in recent blogs, Maestro which combines three strategies (Forte, Adagio and buy-and-hold) and uses a proven periodic rebalancing approach. We’re very excited about these new models which are pillars in our ever-growing portfolio of unique, math-driven investment strategies.
We will continue to evolve the weekly performance reporting of our blog in the near future. For now, here are the results for the first week of the year:
Maestro: 0.3% Loss
Adagio: 3.5% Gain
Forte: 1.4% Loss
S&P 500: 1.8% Gain
The VIXY and UVXY hedging trades were active over the past two weeks, doing a good job of positioning the account for an eventual sell-off and reading the reality of the real-world volatility – even though the bubble continued to inflate regardless of pandemics, social unrest, potential increases in taxation, over-valuations, etc.
More details about our trading activity can be found by registering on the Collective2 website and searching for Forte Strategy. A running list of these email blogs and general information about Maestro Capital Research can be found at maestrocapitalresearch.com.