Covenant Capital Management : Optimal Program

Summary

The Optimal Program is designed to give an investor the highest return and risk adjusted return. This program seeks volatility. This program should only be considered as component of a “barbell” investment strategy, placing the majority of assets in “safe” investments and a small minority in very aggressive investments. Participants in this program must be prepared for vastly larger drawdowns and greater volatility of than either the Original Program or Aggressive Program. Annual drawdowns of greater than 80% from daily peaks to valleys are expected and should be incorporated into a client’s decision to invest in the Optimal Program. Clients should only invest in this program if they have a minimum investment horizon of at least 3-5 years. CCM does not limit or target maximum drawdowns in the Optimal Program. Clients should be aware that drawdowns and volatility will be extreme with maximum drawdowns exceeding 90%. Clients should be aware that total losses may be much larger than anticipated and may greatly exceed expectations.

Investment Strategy

This program will take the same trading signals as the Original Program; however, it will allocate much larger risk to each new trade taken. This will result in extremely volatile swings in account equity.