The ULTRA-MAX model is based on using a rules-based, quantitative analysis investment strategy that is highly opportunistic and focusing on 2x Ultra ETFs, along with high momentum upward trending stocks.
Investors who follow this strategy must be, at a minimum, “Accredited”. Under Rule 501 of the Securities Act, Regulation D, an individual is an accredited investor if he or she:
has a net worth (along with his or her spouse) that exceeds $1,000,000 (excluding the value of his or her primary residence); or
has income in excess of $200,000 (or joint income in excess of $300,000 with spouse) in each of the two most recent years with a reasonable expectation of reaching the same income level in the current year.
THE ULTRA-MAX STRATEGY OVERVIEW
ULTRA-MAX is unlike all other Turner Capital portfolio strategies. The list, below, describes how this strategy is managed:
50/50 split of capital in SSO and QLD in bull markets
50/50 split of capital in SDS and QID in bear markets
One or more high momentum stocks
The ULTRA-MAX strategy is considered much higher risk than the other Turner Capital strategies. This means that client risk tolerance for this strategy must be significantly higher than in the other Turner Capital strategies. Short-term trades in high-momentum stocks are common in this strategy. Losses on a per-trade basis can be well over 10%.
Trading frequency is far more opportunistic. This means the strategy may be 100% invested on one day, totally out of the market later in the day, and totally back in the market the next day. The strategy is highly market and holding dependent, based solely on the portfolio manager’s discretion. While the portfolio manager uses all of our analytical (quant-based) algorithms developed by Turner Capital, the portfolio manager can apply the results of those rules in a much more aggressive and opportunistic fashion than other Turner Capital strategies. Most investors investor cannot handle the frenetic pace at which an ULTRA-MAX portfolio is managed. The other Turner Capital strategies are managed at a much lower level of risk and at a far more measured pace than ULTRA-MAX.
How the ULTRA-MAX Investment Strategy is Structured
The core holdings in the ULTRA-MAX strategy are comprised of a 50/50 mix of the SSO and QLD in bullish markets; and a 50/50 mix of SDS and QID in bearish markets.
Particularly in bullish markets, the strategy may have 20% or more of net asset value (NAV) invested in stocks that are trending sharply higher with strong indications of upside momentum. The goal of these trades is to hold onto them long enough to obtain a 25% to 100% gain in as short a time as possible and then exit the trade.
No options are used in the ULTRA-MAX investment strategy.
The ULTRA-MAX Trading Structure
Moving from left to right and as shown in the chart above, the market is considered “bearish” when the market is trending lower between a red symbol and a green symbol. The market is considered “bullish” when the market is trending higher between a green symbol and a red symbol.
Standard Turner Capital rules for overbought, oversold and potential changes in trend (orange diamonds on the chart above) are applied as needed by the portfolio manager.
In all cases, stop loss settings are used and adjusted as needed by the portfolio manager. However, the manager my choose to exit a trade before a stop loss is triggered.