South Bay Wealth Management / Market Direction Formulas

RWA utilizes multiple market direction formulas. While there are some who firmly believe in “buy and hold” - we do not. There are natural efficiencies to a “buy and hold” process. Namely, there is a statistical record of how effective it has been with various market indices, both equity (Dow Jones Industrial Average, S&P 500, etc.) and fixed income yields. While the natural efficiency has proven to be profitable over time, there are also natural in-efficiencies. In other words, the market doesn’t always go up and fixed income yields do not always stay the same.

RWA applies statistical evaluation of the various indices to attempt to exploit these in-efficiencies. This exploitation is designed to minimize impacts of falling equity markets as well as rising interest rate environments (which can cause bond values to fall). Utilizing both proprietary algorithms and third party algorithms RWA is analyzing over 20,000 factors on a daily basis that may influence general market direction. The ultimate goal is to increase our efficiency, thus create an investment gain a higher percentage of trading days each year than what could be achieved by “buy and hold”. This increased efficiency ultimately would also allow an investor to have fewer days of investment losses. The sum is a more consistent return with lower potential for loss in poor market years.