Meet Macro Traxx, our new sub-portfolio!
Designed to take risk to earn higher returns, with smaller amounts of capital
I’ll have plenty more to say on this soon, but the plan to add both a growthier version of YARP dividend investing (with 20% of my total portfolio) and a “macro” level more aggressive trading segment to our service (with 10% of my total portfolio) is underway.
The latter strategy debuted today with 3 new buys, each about 1/3 of a total position. As always, I’m feeding into this slowly to start.
The YARP growth & income sub-portfolio (15% of portfolio) will likely get filled starting this week and continuing into next week. That will focus on stocks that have yields too low to qualify for the main income-driven YARP 40-stock portfolio. The stocks in YARP growth & income will be more along the lines of what they call “dividend growth” stocks. I am targeting a 20-stock portfolio, with similar 1% to 5% weight fluctuations, though this one will be less dividend-sensitive, and thus the trading turnover is expected to be less than traditional YARP that is 35% of my portfolio across those 40 stocks.
Macro Traxx: funky name, clear objective
I bought the URL macrotraxx.com because, well, you never know! This is only 5% of my portfolio, but as I’ve done at other phases of my professional investment career, it has the potential to be the highest return portion. And since every subscriber to this service uses my research and portfolio decisions simply as information they can customize as they wish, the portion of my own portfolio is makes up is irrelevant to anyone but me.
We’ll add some descriptive material to the site on Macro Traxx soon. For now, here’s what it is:
5 positions at a time, typically weighted equally
I’ll use ETFs, not stocks
Those ETFs represent major market segments (“macro”) within the stock, bond, commodity, and even crypto market
Positions can be long or inverse
Long and inverse positions will usually be single-inverse, but I will use 2x or even 3x leveraged ETFs at times. It is all situationally-specific.
These positions might be held for a long time, but more likely they will be held for anywhere from 1-4 weeks.
This is all based on the same market view I have across all of my sub-portfolios. The key difference with Macro Traxx is that it is more of a “swing trading” account for me. I want to spot a good reward/risk tradeoff in the chart, buy a long or inverse ETF to try to profit from it, and as soon as that trend looks to be fading…get the heck out of dodge!
This will be paired with a short-term Treasury to provide a return “cushion” to the total Macro Traxx portfolio. That’s a buy and hold position, though I will rotate it if/as needed and when the T-bills or short-term bonds mature. This is essentially wrapping a fixed return around the Macro Traxx trading portfolio.
If I am successful, I aim to have a high “winning percentage” on the trades and in a less rickety market climate, be able to hold some that can go a long distance in my favor. If that starts to happen, I’ll consider raising this part of the portfolio to more than 10%.
Sounds interesting.