Outperforming the S&P500

It has been a challenge for fund managers and money managers to outperform the market. The market being the popular benchmark. Statistics suggest that 90% of the fund managers can’t beat the benchmark and the few who can, find it tough to do it consistently. This is why behavioral finance suggests that investor should search for Alpha generators and not just pay for active management.
We at Orpheus believe there is a way to allocate the components of the DOW or S&P500 and outperform both of them consistently. If a strategy can accomplish this, it would mean higher return per unit of risk. This idea is what we call Jiseki Portfolio Indices. What we do? We invest or increase allocations in the worst and reduce or close out our allocations from the best. How do we do it? We follow the Jiseki CYCLES. When it turns up from the worst we BUY and vice versa.
Today we are illustrating the JISEKI LOSER’S INDEX performance from DEC 2009 to DEC 2011. The Index delivered absolute positive returns of 27 percent during the period. This was 13.5% annualized. The Index selects ideas from global 1000 assets (including 600 from S&P500 and TSX 100). The DOW delivered 15% for the respective period. This means worst performers of the S&P500 Index delivered more than the Index itself.
This report carries the current running LONG SIGNALS on Indices, a few Commodities and Bonds. In our next report we cover the Early Economic stocks from USA and Canada. We have also carried a primer on Jiseki signal interpretation.

 
Our Jiseki Time cycles are seasonal patterns of strength or weakness in assets. They are derived from percentile rankings from 1 to 100. The higher the percentile more the chance for an asset to weaken and worst the ranking, better the chance for the respective asset to outperform. 100 is top relative performance and 1 is worst performance. The idea is that performance is cyclical. A top performer will underperform in future and vice versa. A top relative performer is also the worst value pick and the top relative underperformer is the best value pick. Jiseki is another name for Performance cycles, time triads and time fractals. The signals are illustrated as a running portfolio and as Jiseki Indices. These signals can be used by fund managers for relative allocations, traders for leverage bets and high net worth clients for selective trades.
Jiseki Interpretation. Signals are interpreted as crossovers between various Jiseki Cycles. All three Jiseki cycles (Jiseki 1,2 and 3) depict different time frames. Example: An asset is ranked above 80 percentile and all the three Jiseki cycles are pointing lower, this suggests a running SHORT SIGNAL. Our Jiseki Indices use different kind of exits based on price and Jiseki Cycles. We have color coded the (Jiseki 1>Jiseki 2) SHORT zones with brown sandy (burlywood) and grey (Jiseki 1>Jiseki2) for LONG SIGNALS.
 
Dr. Ionut Nistor is the co-author of Performance Cycles paper published in Kyoto Economics Journal in March 2009. Ionut is a professor of Corporate Finance. Currently he is pursuing his post doctorate studies at Kobe University in Japan. He is fluent in Japanese, Romanian and English.
The Bric Model from a Japanese Perspective
Ionut Nistor – Econohistory