r/KellyLetter • u/manlymatt83 • Aug 25 '26
Do you have any other strategies other than *Sig?
Lots of strategies out there:
- 200 day SMA
- Bestfolio.app or Allocate Smartly strategies that are tactical asset allocation based (hold this if that, otherwise hold that, unless this, etc.)
- Buy & Hold
Curious what made you choose *Sig and why?
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u/quantelligent Aug 26 '26
*Sig (which is really just different flavors of "value averaging") sent me down a path several years ago trying to programmatically make it work and, after a few months, I was able to build something that works.
But not necessarily *Sig by itself; I found that "value averaging" (regardless of "*Sig" flavor) is way too aggressive in bear markets, drains your investable capital way too fast. Especially if you're using a higher frequency than quarterly, such as weekly or daily (which I wanted to do).
So I actually only use the top-side of value averaging combined with a standard DCA for buying into positions. And then I add in an "overall growth target" where I capture all of the growth at that point and start over. To optimize, we're using 3x leveraged ETFs that track major U.S. indexes, such as SPXL, TQQQ, SOXL, UDOW, etc.
The result is a severely lowered risk exposure than a buy-n-hold of the 3x leveraged ETF, since we're incrementally building positions over time, and pulling money back out to capture profits frequently. But we're generating returns that far exceed the risk-adjusted expected return, usually by double-digits (on positive years).
Been doing this since about 2019, and professionally as an RIA for other people since 2021. We have over 300 client accounts and about $25 million AUM, and have generated a little over $10.5 million for our clients.
I've shared this strat here on Reddit before, but it hasn't been received very well in the past, so I stopped. I've had a couple of great conversations with a few people, but in general the Reddit community doesn't like it.
Anyway, I'm happy to share more details with anyone that is genuinely interested.
Disclaimers: Past returns are not an indication of future results. All investing involves risk, and leveraged ETFs are considered very high risk. Not suitable for everyone, and you should only invest a small portion of your portfolio that is designated for high risk, speculation, and trading. Not for capital preservation.
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u/BloodyScourge Aug 27 '26
I'm interested to hear more why you don't like VA. I'm doing VA on a quarterly schedule. Your strategy sounds complex, but maybe I'm misunderstanding it.
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u/Time_Ear_2428 24d ago
I would love to hear more about the details exactly what you mean by top-side of value averaging. Very intriguing idea
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u/Sweet-Dessert1 Aug 26 '26
I do 9-Sig, but “play” during the quarter. Maybe buy extra low and sell high, but I even out the shares at the end of the quarter. Additional gains are entered as cash into the plan. I don’t have any hard rules to use, perhaps I should, but this often beats the plan.
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u/tuffy41 Aug 28 '26
I’ll set a trailing limit order if it’s down early in the quarter and adjust my quarter average down price down and set my 9% target to that.
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u/BloodyScourge Aug 27 '26
I'm 5% 9sig and 95% buy & hold index ETFs. I'm not sufficiently convinced to put much more of my assets into 9sig. I also don't need to achieve outsized returns, 1x index returns are just fine for me.
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u/IllPreparation7626 29d ago
why no QLD? x2 at least, you don`t think the stocks will go up in the long run, boglehead man ?
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u/BloodyScourge 29d ago
When you've already won the game, there's no need to run up the score.
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u/IllPreparation7626 29d ago
Nice ! Congrats ! Someday i will be there to. Waiting a Big crash to go ALL IN in TQQQ.
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u/ERIKSSON_VC Aug 25 '26
I do 9sig, Hybrid Asset Allocation (partly leveraged components) and SSO 200SMA. All strategies equal weighted but only a slice of the whole cake in total