Objectives
The goal of Algos4Alpha is to deliver to investors superior returns
by employing quantitative analysis and mathematical modeling of
stock market dynamics.
This provides a more systematic approach to investing & transfers
decision-making process from human to the emotion-free
algorithms. We strived to design our
algorithms flexible enough to adapt to different market
conditions. The benefits of algorithmic approach is in
mitigation of trading decisions driven by emotion, indiscipline, passion,
greed and/or fear, and other factors that contribute
to human error. With a computer picking your next stock
the investment decision process is getting much easier.
Is this service appropriate for you?
Our models are in no way a quick rich scheme.
They suit best business-minded people with a long-term perspective
who are open to the possibility of spicing up their core
investment portfolio with more aggressive high-reward strategies. As a matter of
fact, because of their superior returns we like to think of our models
rather as business opportunity than traditional investment.
Our models are not appropriate for people who seek to trade
financial securities for income. This is not a quick rich scheme but a great diversification
tool for patient investors to grow their capital over time.
Stop-losses
None of the offered models use stop-losses. We don't believe in
stop-losses that are often exercised at someone's discretion and in the heat of
the moment. Moreover, simulation showed that stop-losses have a
long-term detrimental effect on the portfolio performance. But our
goal is to take maximum advantage of the markets and for
this we will not use any artificially imposed constraints on
the market's moves. It's also noteworthy that
most of the time after undergoing correction the stocks are bouncing
back with a vengance. As you might have noticed from performance
tables, if you have no stamina for unavoidable market corrections &
quit, you lose. Successful investment is a lot about having a
right mind-set and being adventurous enough to take calculated risks. And
only you and you alone have a control over your state of mind.
Leverage
None of our algos use leverage per se but some of the algos might use
leveraged etfs. We don't believe in
borrowing capital for investment b/c leverage is a
double edge sword: as much as it has a potential to increase your
gains it has the potential to enlarge your losses by the same
magnitude. Worse than that, leverage can lead to margin calls:
a broker's demand to deposit more funds or face the prospect of
a forceful liquidation of your positions if your account value falls below
certain required levels. This situation is not unlike a poker player
going all-in and losing it all. But every good poker player knows to
manage their betting size in accordance with their bankroll size in order
to avoid the risk of ruin. To stay in the game & keep playing after
bankroll drawdowns is also the rule #1 of successful investing.
Margin
Even though we never use margin, you still have to open a margin account to
trade our strategies for the reason that all our strategies suggest
selling of the old positions & immediately buying the new ones for
the same amount. This type of consecutive trades might not be filled
as expected by your broker in a regular non-margin account.
Risk
Every investment has some type of risk associated with it. You
should never invest more than you can afford to lose.
How much should you invest?
That depends very much on your age and risk-aversion. But as a rule
of thumb, the more riskier is a strategy the less
capital should be allocated to it, and the younger you are, the
more risk you can take in your ventures. But when it comes to
investing your money for profits, risk taking is neccessary. Algos2alpha offers a smart &
disciplined way to enhance your core conservative portfolio with high-reward
quantititatively researched models.
Your money
We never take possession of your funds, you are at all times in full control of
your funds as well as any decisions regarding their investment.
Algos4alpha offers a great diversification opportunity for
business-oriented investors with a long-term outlook. If you
don't have time to study the markets or want to forgo a steep
learning curve and avoid new investors pitfalls,
Algos2Alpha is a right tool for you.
