How often do ALL our strategies trade on the same day?

Mar 15, 2024


VTS Community,

Yesterday I showed some visuals of our 3 tactical rotation strategies and how often they take trades.  Essentially it works out to about 2-4 trades per month on average.  Lately it's very low because we're riding a solid trend in the market and just enjoying watching our strategies rack up the profit.  Long-term though each strategy trades on average 2-4 times per month. 

As I always say, as tactical investors our goal is to trade as little as required such that we can ride the strong market trends as much as possible, but trade often enough that we can rotate to safety and side step as much of the bad market periods as possible.  Getting that calibration correct is why our long-term performance has been so good.


Today I thought it would be interesting to show everyone how often 1, 2, or all 3 of our strategies change position on the same day.  So we're talking about Defensive RotationTactical Volatility, and Strategic Tail Risk.


1 of our 3 tactical strategies changing position:

As you can see below, single days with 1 trade in those 3 strategies are pretty common, it's happening on 23.91% of days.  All three strategies harvest different Volatility metrics and have different thresholds, so it's designed to have them moving as independently as possible.  About 1/4 of days we'll have one of our strategies change position.


2 of our 3 tactical strategies changing position on the same day

Far less common, but on 4.66% of trading days we see 2 of our strategies change position on the same day.  When all strategies are using different thresholds it naturally requires a larger move in the market to jump across a threshold in 2 strategies.


All 3 tactical strategies changing position on the same day

It only happens on 1.53% of trading days, but there are times when our Volatility metrics make a significant single day move and it would cross over the thresholds of all 3 of our strategies on the same day.

Given the nature of "Volatility" and that it spikes higher far faster than crushes lower, most of these days would be when the market is significantly down.  Essentially, when we have days where all 3 strategies trade, there's a very good chance it's all 3 of them rotating to safety on the same day.


Now each trade likely only takes a minute or two so even on those rare days when there are 3 trades to take it still doesn't take much more than 5 minutes to execute.  This is one of several major advantages to our VTS Total Portfolio Solution.

Our goal is to capitalize on strong market trends, but we are nimble enough that when necessary we can actually rotate fully to safety in a single day.  The traditional financial industry is handcuffed and clients just have to watch their net worth decline with the market.  At VTS, we can move to safety in a single day which dramatically reduces our long-term drawdowns.

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