VTS Conservative VOL Strategy Explanation
With volatility trading exploding in popularity recently, many traders out there are jumping in with both feet, perhaps not realizing how difficult it actually is to make a consistent rate of return in the long run. It’s been over a year since there was any market turbulence at all, and this is the problem.
Likely 90% or more of this new breed of “experts” weren’t around in 2015 or 2014, or earlier when it was very normal for aggressive traders to be giving up 50 or 60% of their fund value due to drawdowns. Most just started a year ago and have no experience with the basic risk reward profile of trading volatility products.
As you all know I’m going the other way with this, constantly looking for ways to reduce risk and improve the long term viability of trading these products. A high rate of return in one year is great, but it’s far more important to me to get that for a decade or longer and the only way to do that is to manage risk BEFORE the markets turn. Doesn’t do much good to do it after.
For those who agree that now is the time to take risk off the table, the VTS Conservative VOL strategy may be for you.
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