Support Desk |
ETFOptimize Support > Help Desk > Knowledgebase

Search help:

Best Approach for Investing My Funds to Get Started




Q:  When getting started, do you recommend buying all the positions currently held – or only when new ones are recommended?


A: There are two ways to approach getting started:

1) Set up a cash-funded account and only purchase your ETFs when they are newly recommended. Leave the balance in cash until you have used it all in the purchase of new ETFs.


2) Buy the current ETFs held in each model on the coming Monday (even if we have held them for a while) and accept that they may soon be sold and replaced.

Either approach is valid, and the most significant difference is in accounting. Approach #1 offers you the ability to match the performance of each position (but available cash could be sitting in your account for a while), while Approach #2 gets your funds invested and working for you immediately (but the first purchases will have different returns than the ones in our model).

The correct approach for you depends on whether you place a higher value on 1) accurate accounting or 2) immediate returns. 

However, regardless of which approach you select, after several months, your brokerage accounts should be on the same equity curve as the model(s) you are following, and the real-time performance of each ETF you own should coincide with the returns of the positions in the models. We really can't recommend one approach as having an advantage over the other.



Was this article helpful? yes / no
Related articles Do You Make Changes to Your Model's Algorithms Once Launched?
Article details
Article ID: 15
Category: Knowledgebase
Rating (Votes): Article not rated yet (0)

« Go back