Strat Asset Management, LLC : Global Diversified Program

Summary

There are many professionals that use a long term break out approach for investing in the commodity markets. What makes us different is the way we manage the positions in the portfolio everyday. We strive to have the absolute lowest volatility in our portfolio on a daily basis with long-term capital appreciation.

Investment Strategy

The Advisor relies on a systematic technical trading algorithm that utilizes quantitative analysis of pricing data to identify and exploit long-term price movements in the commodity markets. Once a signal is generated, the position is initiated as long as the portfolio is adequately funded for that particular commodity, and the allocation (depending on open positions in the portfolio) allows the advisor to add that commodity to the portfolio. All US futures contracts, foreign futures, and forward contracts will be considered for trading in this program. The strategy is designed to take advantage of long term movements in the futures markets while keeping risk to a minimum. Based on this type of trading approach, the systematic technical trading algorithm calculates a strategic exit level from the entry price to minimize the loss in that market. The risk on each trade varies depending on the diversification of open positions in the portfolio. On average, the risk is less that one percent of the portfolio value per commodity.

Risk Management

Asset allocation is based upon the premise that no one market should impact the portfolio to a greater or lesser extent than any other market. Due to the different market values and volatility of each market all trades are position adjusted based on the equity in the portfolio. Furthermore, the account is analyzed with a proprietary algorithm to measure the relationship between all open positions to equalize the return impact that one commodity or a group of commodities can have on a portfolio. This allocation and diversification is recalculated on a daily basis. Clients should note that managed futures are inherently volatile and risky, and that no risk reduction strategy can eliminate the possibility of significant losses.