THIS WEEK’S FOCUS

🛡️ Mastering Hedging: Advanced Strategies for Every Investor

Hedging often gets labeled as “too complicated,” but it’s just a fancy term for protecting your portfolio from unexpected losses. Advanced hedging techniques might sound intimidating at first, but trust me—they’re like tools in a toolbox. Once you know how to use them, they’re not just useful; they’re essential.

STRONG FOUNDATIONS, FUTURE FOCUSED

Spotlight Strategy: MOBY ESG FUND

The MOBY ESG Fund, developed in partnership with Moby Investments , is a cutting-edge trading strategy designed to deliver optimized portfolio performance through dynamic rebalancing. If you’re looking for a strategy that balances customization, sustainability, and results, this one is worth exploring.

🌟 What Makes This Strategy Unique?

Precision allocation, smart timing, and dynamic adjustments.

At its core, this strategy manages a portfolio of equity assets by customizing the weights of each holding. But here’s where it gets interesting:

• Dynamic Rebalancing: The strategy adjusts its portfolio allocation based on the day of the month, ensuring timely responses to market changes.

• Flexible Allocation: Choose to distribute capital equally across assets or assign weights based on your preferred criteria.

• Daily Execution: The algorithm reviews the portfolio every day to identify rebalancing opportunities.

This approach not only reduces risks but also enhances returns by ensuring your portfolio stays aligned with market conditions.

📈 Performance Highlights

Outpacing benchmarks with sustainable growth.

The MOBY ESG Fund has demonstrated remarkable performance since its inception:

• All-Time Return: +333.57%

• Annual Return: 34.13%

• Benchmark Comparison: Beat the S&P 500, which gained 81.69% over the same period.

Risk-Adjusted Success:

• Calmar Ratio: 1.07, indicating strong returns relative to drawdowns.

• Risk Score: 1.84, placing it in the moderate-risk category—ideal for balanced investors seeking growth without extreme volatility.

💡 Why Choose This Strategy?

Smart tools for smarter investing.

The MOBY ESG Fund simplifies complex allocation and rebalancing processes, making it easy for investors to stay ahead of the curve. With built-in flexibility and consistent monitoring, this strategy provides:

• Sustainable Growth: ESG investments align with global trends and ethical investing principles.

• Dynamic Adjustments: The algorithm takes care of rebalancing, so you don’t have to.

• Outperformance: The strategy has consistently beaten traditional benchmarks, demonstrating its value over time.

ADJUSTING YOUR SAILS IN CHANGING WINDS

🔄 Dynamic Hedging: Staying Flexible as Markets Shift

Dynamic hedging means actively tweaking your protective investments (a.k.a. hedges) as market conditions change. Instead of setting a hedge and forgetting it, you make adjustments to match the market’s mood.

Let’s say you notice the VIX—a measure of market volatility often called the “fear index”—is rising. This usually means investors are nervous about a potential market drop. In response, you could:

• Add inverse ETFs (which increase in value when the market falls) to your portfolio.

• Adjust your put options (a contract that gives you the right to sell an asset at a set price) to lock in protection.

By monitoring market signals and rebalancing regularly, you can ensure your hedges remain effective.

OPTIONS DON’T HAVE TO BE SCARY

📈 Advanced Options Strategies: Maximize Protection While Staying Strategic

If you’ve only heard of options in passing, here’s a quick rundown: an option is a financial contract that lets you buy or sell an asset at a set price before a specific date. Here are two advanced strategies you can use:

1. Collars: Protect without breaking the bank.

• A collar combines two options:

  1. Protective put: Gives you the right to sell your stock at a specific price (protecting you from losses).

  2. Covered call: You agree to sell your stock at a set price if it goes up, earning income upfront (called the premium).

Think of it like trading some of your upside potential for peace of mind if the market drops.

2. Iron Condors: Profit in calm markets.

• An iron condor is an options strategy that works when markets are stable. You sell two options (a call and a put) close to the current price of an asset and buy two more further away.

Translation? You make money if the asset price stays within a range. Perfect for times when the market isn’t moving much.

RARE BUT BRUTAL

🦢 Hedging Tail Risks: Prepare for the “Black Swan” Moments

A tail risk is an unlikely but extreme market event, like a sudden crash. Hedging for these risks ensures your portfolio doesn’t crumble if the worst happens.

Here’s what you can do:

1. Volatility Swaps: A contract that lets you profit when market volatility spikes, even if you don’t know which direction the market will move.

2. Equity Index Futures: Think of these as bets against the market—you profit if the broader market drops.

TARGET YOUR HEDGES WHERE NEEDED

🎯 Sector-Specific Hedging: Protect What’s Most Vulnerable

During market downturns, some sectors—like tech or energy—tend to fall harder than others. Instead of broadly hedging your entire portfolio, you can zero in on specific areas of risk.

How to do it:

• If you hold a lot of tech stocks, hedge with an ETF like SQQQ, which shorts the Nasdaq-100.

• For exposure to volatile commodities, consider options on crude oil ETFs like USO.

• Balance your risk by adding defensive stocks (e.g., utilities or healthcare) that tend to perform well during downturns.

POWERFUL STRATEGIES, NO STRESS

🤖 How Surmount Simplifies Advanced Hedging

At Surmount, we make advanced hedging not only accessible but also easy to implement. Our platform is designed to give you the tools and automation you need to protect your portfolio from market surprises—all without requiring you to become a financial wizard.

Here’s how Surmount can power your hedging game:

• Customizable Strategies: Set up rules-based hedging plans tailored to your portfolio, like using inverse ETFs to offset market declines or incorporating options for downside protection.

• Automated Execution: Let Surmount handle the trades for you. Whether it’s rebalancing or initiating a hedge when certain market conditions arise, our platform ensures precise execution.

• Real-Time Insights: Stay ahead of the market with performance tracking and alerts that make it easy to monitor and adjust your hedges as needed.

• Flexible Risk Management: Combine various hedging tools like sector-specific ETFs or options to create a comprehensive, dynamic strategy that evolves with your portfolio.

Surmount’s intuitive platform makes it simple to safeguard your investments while pursuing growth. With just a few clicks, you can build and automate strategies that keep your portfolio resilient in any market environment.