PowerStocks Labs, a research unit of PowerStocks Research, has released South Africa's first "Designer" mechanical investing strategy for its subscribers, dubbed "PowerShares Series-A". This strategy was developed over 4 months of research and backtesting and with tiny portfolios of 5 shares, managed to deliver a stunning 3,227% growth (42% CAGR) over the 1999-2009 10 year back-test period.
Dave Keene, head of PS Labs, a division within PowerStocks research established to develope "designer strategies" commented that the strategy is targeted at a propriatary large stocks universe taken from the JSE TOP-100 which allows for excellent liquidity and no theoretical limit to the amount of funds you can invest. The other benefits of this large stocks universe is that it eliminated any survivorship bias in the backtests.
The high risk adjusted returns designed into the strategy deliver stunningly low volatilities for such small portfolio sizes. The strategy also delivers the best of both worlds and is designed to power ahead during major bear markets, whilst also participating fully in major bull markets.
PowerShares Series-A has low maintenance. You buy 5 shares at your friendly online broker and sit back for 12 months, rebalancing and re-investing your proceeds into the following years portfolio. Whilst not the best absolute returns based strategy covered here at PowerStocks, the PowerShares Series-A strategy was designed for a best mix of risk and reward. Targeted at the private online investor, its low volatility and low maintenance coupled with superior growth and consistant win rates against the ALSI make it an excellent starter strategy.
Details on the PowerShares Series-A can be found on the Research main menu.