It is our belief that avoiding severe losses is extremely important in achieving strong market performance over the course of an entire market cycle. We approach this by hedging the portfolio with an overweight in cash of fixed income depending on the current stage of the business cycle.


What we believe is the business cycle is actually a debt cycle based on legendary Ray Dalio's unorthodox view of the economy. Ray's basic theory is that debt is the main driver of the business cycle because it allows us to consume more than we produce when we acquire it and forces us to consume less than we produce when we pay it back.  This creates a cycle of growth when people are spending in excess of what they produce and less consumption when eventually they have to pay it back. By measuring real GDP and comparing it to the capacity (productivity) of our nations GDP we are able to graph this cycle.


As far as I am aware we are the only ones that have been able to graph the business cycle. However, I am confident that others like Ray Dalio have done something similar. Once we have a general idea of the business cycle we can then use our economic models to determine what stage of the cycle we are in. As shown in the chart to the left, a powerful thesis on the market and the business cycle evolves, helping us tactically positions our portfolio's for the future.


Your clients' portfolios are comprised of tactically shifting asset allocation that can be more defensive but never target over your clients' risk suitability.  You can sleep easier knowing your clients’ investment portfolios are positioned to participate in market gains while maintaining a defensive structure capable of withstanding even the most challenging environments.


Our core portfolios are designed to accommodate a complete spectrum of a clients risk level; from conservative to aggressive.  Your clients are never more aggressive than there corresponding risk level, however, in times of economic uncertainty, a portfolio becomes more defensive to avoid the long-term impact of recessions.  Our conservative approach is based on quantitative business cycle investing and risk management algorithms.


The sector rotation portfolio is designed to supplement our core models. Our core models are inherently designed to be more conservative when the market is weak, sometimes there is a trade-off from this strategy by underperforming the overall market. To counter react this, our sector rotation model is optimized to add an additional risk-adjusted return to a portfolio for clients that want both growth and defense while providing diversification beyond investing in individual stocks and focusing on an entire industry or sector.


Focusing on quality growth stock we are able to add aggressive growth to a portfolio without the trade-off of diversification like its counterpart the sector rotation model. Like our sector rotation model, this portfolio is designed to be an add-on to our core models.   When investing in individual stocks additional risk to a portfolio is expected; our model attempts to control this risk, but proper risk assessment of your client's goals is suggested before investing in high risk-reward portfolios such as individual socks.


Images and rates of return are illustrative only. They do not represent any actual investment and are not a guarantee of return. Any investment involves potential loss of principal.

Diversification and asset allocation strategies do not assure a profit or protect against loss. Past performance is no guarantee of future results. Investing involves risk. Depending on the types of investments, there may be varying degrees of risk. Investors should be prepared to bear a loss, including a total loss of principal.



Office: 817-500-0556

Fax: 817-500-0559

550 Reserve Street

Suite 190

Southlake, TX 76092