Strategic Investments

Commodity

The Commodity Program is primarily a fundamental program, using technical tools to indicate entry and exit points. This program typically trades the Precious Metals, Energies, Grains, Meats, and the Softs. Risk control is perhaps the most important aspect of Strategic’s approach to the portfolio management process and it is the basis for all modeling and research. The approach is multi-faceted and has an ongoing development process dating back to the inception of the firm’s track record. Low Leverage: Assets are margined at approximately 50% of each contracts actual value. While exceptions do occur for certain markets, this puts the firm’s margin to equity ratios on the low end of the industry spectrum. Strict Trend Adherence: We do not initiate or maintain positions which conflict with the long term trend as identified by our proprietary algorithms. Correlation: Each program is constructed to contain multiple asset classes which were selected because they displayed sufficient negative correlation. Each portfolio is specifically designed and continuously back tested in order to perform under multiple market scenarios, such as ones with a high degree of inflation or deflation. Volatility Cutbacks: Volatility models are used to determine when a specific market’s volatility has increased to the point where the risk has become unacceptable. At this time we reduce our positions and tighten our risk controls on the remaining positions.