System Addict:Regime Change (you are here)

A concise view on our systems, portfolios and our methodology. The key to superior returns.

Starting our Mondays with a focus on strategy and systems provides a grounded approach for the week ahead. By emphasizing methodical planning and systematic execution, we ensure that every decision is based on solid, repeatable processes rather than fleeting impulses. This disciplined approach helps us minimize errors and maintain consistency, setting a strong foundation that aligns our activities with our long-term investment goals.

Shifting our initial weekly focus away from big ideas to more concrete strategies also allows us to methodically assess our positions and market conditions without the distraction of overly ambitious concepts. This not only keeps us aligned with our strategic objectives but also positions us to better capitalize on opportunities that align with our established systems. As a result, we are better prepared to adapt and thrive in an ever-changing market landscape.

---

In the short term (1-3 months). In the current trading environment, we are prioritizing risk assets over defensive assets, favoring low beta over high beta, and choosing defensives over cyclicals. Our strategy leans towards growth stocks over value, large caps and SMID caps, and U.S. markets and a few international ones. In terms of asset class preferences, we are opting for developed markets (DM) and some emerging markets (EM), Treasurys over spread products, and long rates over mid and short rates even though we do like the short end of the curve. We prefer high yield over investment grade bonds, and within commodities, industrial commodities are favored over energy and agricultural ones. Finally, gold is preferred along with foreign exchange (FX) and the U.S. dollar (USD). This approach is designed to optimize our portfolio's performance by strategically selecting sectors and asset classes based on their current market potential and stability.

Here are our systems, portfolios and some key catalysts to look out for.