Mini Courses

What is Advanced Portfolio Hedging?

Class Outline

Included

• 2 days of class instructions
• Access to Class Recordings
• PDF copy of slides
  
• Supplemental P.O.T. Class Recordings
• Free 30-day Trial of P.O.T. Class (*For New Students Only)

Frequently Asked Questions

Succumbing to huge demand on Friday from students, the rolling of the SPCX positions and the sense of urgency to start a new 6-month Collar Example, the office announced a next mini class a little earlier than planned.  It was mentioned to a couple people and then leaked fast, so we just told everyone.  Some questions have come in since Friday that are likely being asked by most, so we are sharing them here.

QUESTION ONE:  Is the first Portfolio Hedging Mini Class (intermediate)required to take this one?
ANSWER ONE: Not really. Though there is no formal requirement to attend this mini class, it will be highly recommended and easier to follow this mini class if you had taken the first. The first hour of class for this course will be a recap of the previous class materials. Obviously, it is only able to give a way of explaining where we left off, and how this class is a different approach. A compare and contrast, if you will. As a result of people already asking for the first class, the office will be offering the first class recording at the original flash sale price. It is listed on the website at $599; however, it will be discounted to $499 (original flash sale price) for those wanting both classes at a packaged price of $1,148.00 (Intermediate + Advanced Portfolio Hedging Mini Classes) for a one step purchase.

QUESTION TWO:  Is this Advanced Portfolio Hedging Mini Class a prerequisite to doing the 6-month Study that follows?
QUESTION TWO:  Scott is not a fan of having prerequisites, but in this case, the answer is YES.  Most classes are strategically designed as 'standalone' classes to make things easy, affordable and customized as you like. What we learned in the first 6-month Study, however, was that having people in the study who did not have the mini class caused confusion and a slowdown among the students. Scott was working from the assumption of knowledge from the class for the students when making trades. When he did a trade/adjustment that should have been understood by everyone, things broke down a little and required a lot of fixes and clarification to correct. Part of the advanced PH mini class will be a quick explanation of the process, adjustments, monies, capital allocation, etc. that will be imperative to a smooth running 6-month Study.

QUESTION THREE:  Do you expect the same results as the first 6-month Study with this next one?
ANSWER THREE:  NO. The first 6-month study was amazing, at the same time chaotic. We started the study in the middle of President Trump entering office and his initial “tariff tantrum” in the markets. The SPX was higher by 10-12% and quickly went negative by as much. Tech was getting destroyed in fear of interest rate jumps.  We expect and hope to beat the markets by 1% a month.  Warren Buffett became a thing of legends by averaging about 19.8% a year (about 0.8% better than the S&P per month). The S&P has averaged about 10.2% per year in the same time frame as Berkshire. If we beat by 1% a month (average), we are rock stars.  In the previous 6-month Study, we made about 38% in 6 months when the market made 10.8%, so we beat it by 3% a month. This was probably too good. And students who had smaller accounts did even better because they were limited in selling some of the calls that the normal size accounts ran into trouble with.  It is highly unlikely we will do this well again, but you understand why there is so much enthusiasm with this product— especially all-time highs in the market.  Also, no investment is guaranteed. Losses can occur, especially in the short term. With stocks, derivatives, options, bonds, etc., losses are common and past results are no guarantee of future returns.  In the previous 6-Month study our account was down almost 6% when the market was down 13.26%. 

If you are looking for a guaranteed profit, this is NOT it. Also, all trades Stratagem, its employees, contractors, owners and staff are NOT meant to be copied. Paper trading is the best way to learn with no risk.

QUESTION FOUR:  Will students get the results of the 6-month Study that follows?
ANSWER FOUR:  StratagemTrade believes in transparency.  The whole universe will be able to see them. This is probably the dumbest decision any firm could make, but it is what we do. Most firms keep quiet about their trades or selectively show their winners.  In POT and the previous Portfolio Hedging 6-month Study, all the participants see every trade, and others see the results in the Morning Coffee Report or Facebook and our YouTube channel.  It is not really smart for us to be 100% transparent as it is a “no-win” situation. When we win, people think “they are better, they are floor traders”. And when we post losing trades, people can judge and mock while looking at other firms who have never POSTED a losing trade ever. We feel transparency is honesty, and what is needed in this world and for trust. People do not care what we know until they know we care.  Having said that, the answer is we will post the results frequently throughout the 6-month period; however, only people who are in the 6-month Study will see every trade.

QUESTION FIVE:  When will the 6-month Study begin?
ANSWER FIVE:  This will be announced during the mini class, but we expect it to be a couple weeks after the Portfolio Hedging class ends. This will give us plenty of time to complete the class, answer questions, get everything and students set up, etc.  At the same time, I will push for it to be earlier given great market conditions like fear, turmoil, falling markets, war, etc.

QUESTION SIX:  I voted for a 1-day class. Why is it going to be a 2-day class?
ANSWER SIX:  Firstly, the majority of students voted for a 2-day class with more information than can be done in one day.  Secondly, the key is to learn how to do this yourself.  Thirdly, the more questions and “asks” that come in looking for education on certain topics, the more time that is required to do an in-depth explanation. People will not only want to learn what to do, but also understand why.

QUESTION SEVEN:  If I take this class, do I get the 6-month Study for free?
ANSWER SEVEN:  NO, unless you are in P.O.T. class. P.O.T. students get it FREE as a bonus for their loyalty and dedication. Non-POT students will be charge a very reasonable $189 a month or a discounted 6-month flat rate ($1,020), which is very cheap.  The amount of work that goes into just managing the trades, answering questions, writing follow up tutorials and explanations along the way, sending out real-time updates and thoughts, etc. is astronomical.  No firm could even break even on that pricing scale, even with a much greater audience. People will have slack access, staff need to be hired for the study, etc.  This is more a labor of love.

QUESTION EIGHT:  Why have you started to spend so much time on stocks and Portfolio Hedging?
ANSWER EIGHT:  This is a two-part answer:

First: Sixty (60%) percent of Americans have retirement accounts that account for 27% of their wealth (according to Gallup News).  The crash in 1987 wiped out $500 billion in a day. The market has got so big since then that $500 billion is made or lost with less than a 1% move (50 SPX points) in the market these days. Small daily swings move more money than was made or lost in 1987. Market corrections are inevitable, as are crashes. People cannot afford to lose 50% of their wealth in the next 1987, 2000, 2008, 2020 …. right when they are retiring. Even if they have the tenacity and confidence to ride it out, who needs the stress?

Second: Serendipity.  When Scott was teaching a mini class, a student asked a question about how Warren Buffett made money. Most people do not realize he hedges, and simply believes that he is the world's best stock picker. The real answer shocked people to such an extreme and extent that the next mini class on Portfolio Hedging was created right then and there. 

NOW:  After the first 6-month Study, it is impossible for a day to go by without someone asking to do it again. What we learned in the first one will be used to improve this Study.  This is partially why we call this an advanced class even though you don't strictly need the first class to understand this.

QUESTION NINE:  I know Scott is considered one of the best in the trade.  He has seen everything, traded everything, and knows everyone. I heard about him here in Germany.  Because of time zones I may not be awake for the class. Is it recorded? Can I listen to it many times?
ANSWER NINE:  The class will absolutely be recorded. You are not alone nor isolated. It is not an exact number but about 40% of our students cannot attend live and listen to the recordings on their schedule. We are in Asia, Europe, South America, Australia, and Africa. I think the only continent we are not in is Antarctica. Because lawyers say that everything needs a time limit or it is not a contract, we officially limit access to one year. However, we have never enforced that and have students go back years listening to an old purchase to refresh their knowledge.

QUESTION TEN:  What is the same or different from the last 6-month Study and mini class?
ANSWER TEN:  The mini class outline will be released shortly. We will focus more on hedging indexes for long time low risk while removing non-systematic risk from the portfolio. Warren Buffett has stated that most people (and professionals) should focus on just owning an index instead of chasing the “hot names” and not being able to beat the market.  We will focus on advanced hedging strategies, crash scenarios, asset allocation, permanent positioning, revenue techniques (if you need to live on the profits), re-balancing the portfolio, etc.

QUESTION ELEVEN:  I see that as a member of POT, I get the 6-month Portfolio Hedging Study for free. What if I do not take the mini class?
ANSWER ELEVEN:  This is a very good question and creates a hole we do not like but are will fix/patch it with the following caveat.  Those in POT will be seeing the trades go through. Sadly, it is impossible for Scott to address any questions regarding the Portfolio Hedging 6-month Study had they not taken the mini class. Why? There will be new concepts and strategies taught in the mini class that are designed to be implemented in the Study. Scott will see his workload increase for 6 months as it is and will not have time to create very lengthy answers to something that is redundant and was already taught.

QUESTION TWELVE:  I am in POT and am wondering if P.O.T. is going to change in time allocation to focus on the PH study? In other words, is P.O.T. going to be watered down because of the time spent on Portfolio Hedging Study? 

ANSWER TWELVE:  This is a great and important question. Scott anticipates P.O.T. will stay about the same amount of time and trades. He will be adding 20% -30% more work on his end to make the Portfolio Hedging Study an addition, not replacement. This is different and something learned from the last 6-month Study.  In the last 6-month Study, Portfolio Hedging ate eat up a lot of time because of so many equities that were moving in wide ranges. This created a lot more adjustments than anticipated.  This 6-month study is designed so it is low maintenance and low time. It will not eat up P.O.T. time, but rather it will be an additional workload on Scott’s end.

QUESTIONS, COMMENTS, WANTS?  Let us know if there is something you want to see that may not be addressed here and we will be happy to answer your questions, let you know if it is in the class, etc.  Email us at[email protected]or/and [email protected].