Tracking up to 40 markets on global exchanges and on three different time frames is essential since a given market may only trend as little as 30 percent of the time implying that most of the time a market trades within a range. That is the main reason why OCM tracks multiple markets giving us the opportunity to discover and take positions in trending markets as well as the ability to capitalize on short term trends during volatile periods.
For a portfolio to be truly diversified, its components should have low to negative correlation to one another, meaning that when a variable has a low value, the other variable will have a high value (and vice versa). An investment in OCM's Diversified Program, investing in commodity futures, is inherently well diversified due to its negative correlation to stocks and bonds as well as the six major different groups of commodities: Stock Indexes, Currencies, Livestock, Metals, Financials, Grains and Soft commodities such as coffee, sugar and cotton futures.
Combining a small percentage of one's assets with a diversified portfolio of commodities, risk and return can be improved in spite of the higher volatility in commodities. Optimus Capital Management can trade both long and short positions, the Diversified Portfolio has the potential to profit (or lose) in both bull and bear trends in global futures markets.
The following was reported in Portfolio Diversification Opportunities, published by the Chicago Board of Trade:
"Managed futures, by their very nature, are a diversified investment opportunity. Trading advisors have the ability to trade in over 150 different markets worldwide. Many funds further diversify by using several trading advisors with different trading approaches.
The benefits of managed futures within a well-balanced portfolio include:
- opportunity for reduced portfolio volatility risk
- potential for enhanced portfolio returns
- ability to profit in any economic environment
- opportunity to participate easily in global markets "