Learn More About AdvisorGuide

How long do you usually advise holding positions?

With our trend following advice the only objective is to try to capture the one or two major moves each fund might make in a year. As it’s turned out, we’ve consistently held our winners much longer than our losers. The holding period has average about four to six months for winners and one to two months for losers.

With our relative strength systems we recommend holding a position only as long as it is in favor with the market. We find that this is generally no more than a year, as the market tends to change what is in favor. We try to capture what is in currently in favor.

How has your strategy performed relative to its benchmark?

Our methodology helps to reduce investment risk, as measured by standard deviation, beta and drawdown and improve performance for most funds our clients use. One way we’ve been able to reduce risk and improve returns, relative to a buy-and-hold approach, is by introducing the idea of including low-correlating investment strategies in client’ portfolios. This is particularly true during extended bear markets where we step completely out of the declining markets and place our clients into a safe area of the market preserving their capital for the next bull market cycle.

How would you describe your investment philosophy?

One of our central tenets, from a risk management standpoint, is that it’s absolutely necessary to have an offensive and a defensive strategy for each position in a portfolio. That means that only holdings that are appreciating should be held, that is, be part of the “offense”. Holdings that are declining in price should be sold and the proceeds reinvested in safer, low-correlating funds, that is, move to the “defense”.

What is the basis of your investment advice?

We have two primary methods of making investment decisions.

The first concept, and the one that AdvisorGuide was founded upon, uses a mathematically derived, objective, trend-following strategy that defines entry and exit points for each fund we follow, based on the fund’s volatility and price movement. The premise of our methodology is simple: We seek to hold our winners and cut loose the losers.

The second concept is relative strength. We use relative strength to identify areas of the market that are in favor and then we gravitate toward that. In our research we have found that areas of the market that are relative strong continue their strength for approximately 1 year, so we hop on the trend and ride it until it is finished.

How did AdvisorGuide begin?

AdvisorGuide was launched as a daily publication in September 1999. We were struck by the lack of easy, pratical and appropriately priced guidance on tactical investment strategies for the financial advisor community.


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