My name is Maksim Nezhelskii. I am 26 years old. I am passionate about financial markets and want to make the difference by improving standard investment techniques. I have experience of working as the Research Assistant for 1 year, the Day Trader for 2 years and the Investment Research Analyst for 1,5 years. Now I am about to start my PhD in economics and finance.
While investing I adhere the principle of dynamic tail risk hedging. This principle implies dynamic rebalancing of weights of asset classes in a portfolio based on changing economic environment.
All my portfolios are rebalanced according to the proprietary developed Indicator of Positioning in the Short-Term Credit Cycle (or IPSCC). This indicator estimates approximate probability of next financial crisis for the US economy at any point in time. I publish updates of the IPSCC weekly on my twitter page (https://twitter.com/maxnezh6).
If IPSCC goes up (higher probability of crisis) I reduce weights of risky assets (equities) and increase weights of/open new positions in safer assets (bonds ETFs, commodities ETFs and cash) or alternative assets (volatility ETFs and options ETFs). When the probability of crisis is low I load my portfolio with equities up to the maximum. Empirical calibrations show that this approach allows to smooth volatility and maximize returns over the long run. tail hedge agains rare events sometimes help to make money even when everybody bear extreme losses.
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