Buy and hold portfolio in a trading account - Daal, GoC ?

Hi

I’m looking for ways to keep in a IB PM account a low risk buy and hold portfolio for roughly 100% of the capital at risk while trading on margin.

I’m keeping roughly half the capital in the IB account, the remaining mostly in bank accounts , so when using 100% of the funds to trade, the account is already leveraged 2* . I also regularly trade a notional amount superior to 100% the capital at risk.

I’ve started buying BOND etf than increased the position to over 100% of the account balance in BOND, feeling pretty good with it but obvious drawbacks are the high margin required as the portfolio is unbalanced, hence the PM is little helpful in that case, the 2% up yields, hammered with a 30% withholding tax on div while I suffer no cap gain tax, the margin fees, as I’m always borrowing from IB, even more when holding swing positions in other assets, plus the management fee, although this last one would be the lesser issue.

I’m looking along the lines exposed in the Global macro trading journal from Daal

http://www.elitetrader.com/vb/showthread.php?s=&postid=3512895#post3512895

also mentioned in this recent thread :

http://www.elitetrader.com/vb/showthread.php?s=&postid=3747041#post3747041

Quote from Daal:

" A mix of stocks, bonds, REITs, gold and cash. Should return about 6-9% a year with similar volatility(7-8%) and a max drawdown of 15%

Me and Cutten wrote a lot about that in my journal Global Macro Trading for a Living"

Do you think it would be an improvement on the long BOND strategy, it looks much better because futures and less margin could be used, but the drawdown risk is higher, which present significant risks if coupled with drawdown from more active trading.

Also thinking of using it with more bonds but I like BOND which is less volatile than ZN and ZB with solid results.

As of REIT futures in the US I didn’t find any.

Any feedback on this topic will be most welcome

Luis

 

So much feedback :eek:

Also anyone replacing the buy and hold portfolio of futures or ETFs by selling montly atm or slightly otm puts/covered calls/strangles.

Any feedback on the returns, and the drawdown of the portfolio ? I'm mostly looking to increase returns 2 to 4percents a year with minimal drawdowns and margin required.

 

I hate passive allocations and I see no utility outside of a 401K or other tax-deferred. If you have the free time to post here you should actively manage your account. If no edge then find one or hire it.

 

I do manage it actively, but keep enough margin available to add some passive investing if it can increase returns. It seems a reasonable use of IB pm and multi products.

 

Also what would be the difference in a tax deffered account ?