How do I 'sell' an investment strategy?

7

76132

Hello!

I have an investment/trading strategy that I think is profitable. It's pretty correlated with the S&P 500 but there are both a larger upside and downside (so greater risk/reward), however IMO a better sharp ratio. I would like to see if I can manage other people's money using this strategy without going the hedgefund route as that's unreasonable for me (don't have the know-how or upfront capital) and I don't know how well the strategy will do once it's scaled up to millions of dollars.

I looked at the website called Coinvest and while that would work, I have a hard time believing that my strategy would be accepted and listed on their platform. Right now it seems like there are only 50 strategies on the website and most are run by actual established investment advising firms. I am an independent no name investor, with a BS in Economics.

Is there a creative but LEGAL way to make money off my strategy other than investing my own measly savings in it, which I already do. Maybe a legal way to either advise or manage other people's money (not friends/family). I don't plan on actually making a living off of this, at least not in the beginning so fees will be a bare minimum, near 0 management fee (only to cover costs of market data) but with a higher performance fee >20% as I believe in the strategy. I'm in it for the experience, the performance record, and if I can add a few $1000 to my annual salary that would be great.

Perhaps some sort of crowdfunding or lending route? I am willing to get my Series 65 but at the end of day, I would need some clients. I'm looking to manage around $100k to start off. I can put some of my own money in the fund.

Any ideas on how to accomplish this? I am based in the US.

Thanks!
 
76132 said:
I have an investment/trading strategy that I think is profitable.
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What does this mean. Have you traded your strategy with real money? How do you know it is profitable? How do you know what the sharp ratio is? You basically can't do anything meaningful with it until you have a verifiable track record.

Bob
 
Robert Morse said:
What does this mean. Have you traded your strategy with real money? How do you know it is profitable? How do you know what the sharp ratio is? You basically can't do anything meaningful with it until you have a verifiable track record.

Bob
More...
Well I believe it is profitable, and in the long run, I am very sure it is profitable as it's basically betting on a reversion to the mean. I have traded a form of this strategy for 4+ years but I am still constantly refining it, so the strategy today is different from the strategy a year ago.

Additionally, while I have a portfolio that has traded this strategy, that portfolio has also dabbled in other stuff and thus past performance doesn't truly show this strategy as it includes returns from other stuff. I only have about 1 year of purely running this strategy as the other trades I've made in other assets, seem to be too luck based (I dabbled with some individual stocks, natural gas, oil, etc... but this strategy is based on the broad market).

Really the benefit of this strategy is that I believe I can achieve greater risk-adjusted returns than the S&P 500. I would not recommend people who need the money tomorrow to invest in this strategy as there could be large drawdowns, and you would have to ride through those periods. But since it's based off mean reversions, those drawdowns will reverse over a period of time. Frankly, if you believe in diversification, I would recommend only putting a small part of your portfolio in this strategy because it is a high risk high reward strategy. I personally put most of my portfolio in this strategy because I believe in it but that is because I know my risks and I understand my strategy. And I mainly run it for my retirement fund which has a long term horizon so I know I can ride through turbulent times.
 
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I've thought about using something like lending club to increase the size of my portfolio except I don't like having to pay a fixed rate every year as I can't predict when there will be opportunities to invest in the market. As it is a mean reversion strategy, there will be times when the market value is equal to the long term mean and thus I just sit in cash as there's no point to invest. I don't want to be losing money when there are no opportunities to invest.
 
76132 said:
Hello!

I have an investment/trading strategy that I think is profitable. It's pretty correlated with the S&P 500 but there are both a larger upside and downside (so greater risk/reward), however IMO a better sharp ratio. I would like to see if I can manage other people's money using this strategy without going the hedgefund route as that's unreasonable for me (don't have the know-how or upfront capital) and I don't know how well the strategy will do once it's scaled up to millions of dollars.

I looked at the website called Coinvest and while that would work, I have a hard time believing that my strategy would be accepted and listed on their platform. Right now it seems like there are only 50 strategies on the website and most are run by actual established investment advising firms. I am an independent no name investor, with a BS in Economics.

Is there a creative but LEGAL way to make money off my strategy other than investing my own measly savings in it, which I already do. Maybe a legal way to either advise or manage other people's money (not friends/family). I don't plan on actually making a living off of this, at least not in the beginning so fees will be a bare minimum, near 0 management fee (only to cover costs of market data) but with a higher performance fee >20% as I believe in the strategy. I'm in it for the experience, the performance record, and if I can add a few $1000 to my annual salary that would be great.

Perhaps some sort of crowdfunding or lending route? I am willing to get my Series 65 but at the end of day, I would need some clients. I'm looking to manage around $100k to start off. I can put some of my own money in the fund.

Any ideas on how to accomplish this? I am based in the US.

Thanks!
More...

If you had a real winning strategy, selling it would make no sense. If anything, you would be on these boards asking where's the best place to dock your brand new 150' yacht, that was just paid for in cash.
You know what I mean?
If you have a winning strategy, milk it for all its worth, and take the money and run.
Good luck! :banghead:
 
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