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"SUPER INDEX®️ "
Super Indexing uses 7 individual, independent component signals to accurately gauge the actual risk in the marketplace and produce returns in excess of this risk.* Each component of the SuperIndex since inception has been shown to produce a lower beta (in this context, "risk"), a lower downside volatility, and lower correlation with the SP500. Furthermore, this phenomenon of LOWER RISK and HIGHER RETURNS has been observed to apply with the use every major market INDEX vehicle applied to the ALPHA SYNTHESIS.


SuperIndex vs SP500


Beta
Beta may be used as a simple but accurate reflection of risk, and volatility of a portfolio. A beta of 1 means that the respective portfolio has an equivalent price volatility and exposure to the markets ( SP 500 Index). A beta below 1 can indicate either an investment with lower volatility than the market, or a volatile investment whose price movements are not highly correlated with the market. For instance, a beta of 0.5 means that the price of the portfolio will move $0.50 ( and in the same direction) for each $1.00 move in the SP 500. By using an underlying index (NDX100) that carries a higher beta (value > 1), the ALPHA SYNTHESIS has been observed to compress this beta to less than half, and closer to 0.25 (beta of SP500 = 1) while producing returns in excess of both the NDX100 and the SP500 and virtually all other Asset Class Index Averages and ETF's. This is highly illustrative of how Super Indexing with the ALPHA SYNTHESIS has delivered higher returns for lower risk.

Beta Risks in Market Downturns
It was noted during the 2007 - 2009 bear market with great regret by many market participants that beta and correlation values of portfolios are not static and can actually expand during market downturns - often exponentially. This was particularly true for illiquid, non-transparent, synthetic, or derivatives-based portfolios, and generally the case for under-diversified ones. Money managers had successfully used these strategies to produce returns but had under-appreciated the REAL risk of such strategies. Risk that invariably must be accounted for. This led to contentions of "Black Swan" or "Ten Sigma" tsunami events that could not have been predicted or accounted for by existing financial models.


Lower or Negative Correlations
Significantly, ALPHA SYNTHESIS correlations were actually negative during much of this time frame from 2007 -2009 as it "de-coupled" from the markets. Its superior attributes including accurate risk assessment, liquidity, transparency, and ease of execution preserved value and produced absolute returns during this time frame.**



Value of a PORTFOLIO Strategy - High Beta Risks and High Correlation Risks
Portfolios with High Beta levels produce above market returns in uptrending markets, and lower returns in downtrending markets. Over recurring peaks and troughs of multiple market cycles and transactions, beta progressively chips away at performance. Highly correlated stocks or portfolios carry risks of under diversification and may also generate high beta values relative to their respective index. The ALPHA SYNTHESIS has been shown to compress beta by virtue of its entry and exit points in order to produce above market returns.

Super Indexing with ALPHA SYNTHESIS seeks to give investors an alternative to an under-publicized and difficult concept to grasp - that the majority of professional (both active and passive) money managers will regularly under-perform the market averages, while also possibly subjecting their respective portfolios to excessive risk relative to this return. Numerous studies point to the apparent difficulty the majority of professional money managers face with excessive risk and low returns** Many will openly disclose this fact. Some will not. They will instead focus on "socially conscious investing", or "selecting great companies", or "not managing your money based upon someone else's, arbitrary benchmark", or "hedging against a market downturn", or "non-correlated returns", etc.



Value of INDEX Strategy
John Bogle founded the Vanguard Fund family based upon the concept that Index investment yields superior returns when compared to professional portfolio managers and stock selectors. Clearly, he did not believe that benchmarks were meant to be arbitrary. When compared to actively managed portfolios, Index funds are

1. better balanced with
2. lower NON-SYSTEMIC risk
3. lower costs of operations and execution




Value of SUPER INDEX Strategy - ALPHA SYNTHESIS
"Super - Indexing" with the ALPHA SYNTHESIS is a step ahead of Bogle's Indexing strategy. The ALPHA SYNTHESIS Super Index Strategy enhances portfolio returns while reducing the SYSTEMIC risk of investing in the actual index itself. By example, if the Alpha synthesis is only in the market approximately 55% of the time - this would lower the effective SYSTEMIC**** risk ( or Beta ) to 0.55. You will note that the true, actual aggregate beta of the ALPHA SYNTHESIS is actually closer to 0.25. When compared to actively managed portfolios, the ALPHA SYNTHESIS Super Index is

1. better balanced with
2. lower NON-SYSTEMIC risk
3. lower SYSTEMIC**** risk
4. lower costs of operations and execution
5. more transparent.
 
*, ** ,*** ,**** - data from www.timertrac.com

 
Using ALPHA SYNTHESIS

   
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