All Weather Strategies

Most of the economists and market theorists propagate that the nature of capital markets is entirely random.They believe that markets follow an efficient path which is  unexpected where past movements of the market cannot predict future movements.

But under this “randomness“ lies a certain rhythm to the markets that careful analysis can help uncover.

Market is not random but cyclical.

We believe that the markets moves in rhythms and cycles and will likely continue to do so in the future.

There are only 3 Market cycles

  1. Trend

  2. Consolidation

  3. Trend reversal

Predicting the chronological order of the above 3 cycles is difficult but if asset managers can make quantitative strategies suited for at least 2 of the above 3 cycles they can produce extraordinary returns. Also the above “simple but true” wisdom will ease out complications in their asset management journey.

This is how we devised our All Weather strategies which take advantage of natural rhythm and cyclical nature of the market.

The key of our strategies lies in the fact that it naturally correlates to the ebb and flow of the markets. Each of our strategies work in at least two of the three market cycles. This enables us to generate more profitable product models and consistent returns across all three market cycles.

It also protects us in all kinds of market shocks and unpredictable price behaviour.

In the end we always remember that it takes courage to stick with a simple yet consistent strategy through highs and lows, which is a hallmark of success in capital markets.

 

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