The financial services industry is primed to sell as much ‘investment product’ to as many people as possible and ‘long only’ is what sells. Average investors are spoilt for choice. This is not the case for investors that don’t seek comfort in the herd. They think for themselves and are willing to work a little harder to find suitable investment vehicles.
If diversifying an investment portfolio was easy, the average investor would have done it and not lost out in the 2008/09 financial crash. Ordinary investors buy off the shelf. The product they buy is designed by investment houses. Investment houses design ‘investment product’ that will sell and generate fees – performance is less important. That is how the industry works.
The ordinary investor is looking at a forest of investments – buy domestic stocks, buy windfarms, buy foreign stocks, buy European bank stocks, buy battery makers, buy property, buy Brazil, buy bitcoin, buy cannabis stocks and on and on.
The unconventional investor wants his portfolio to perform in booms and crashes and everything in between. He needs a portfolio with real diversity. The Great O’Neill provides a real alternative to the ‘buy everything crowd’. We offer unconventional investors a genuine alternative to conventional ‘long only’ investments. We are untethered to the performance of stock, property, bond and commodity markets.
The number one objective of any good investor should be to survive. This objective should transcend all others. The vast majority of those that were unprepared for the last financial crash are equally unprepared for the next one.
Most (conventional) investors do not understand why markets crashed in 2008/09. Ergo most investors are hopelessly unprepared for the next crash. Average investors that are long stocks, property and bonds etc. may not survive the next financial crash. For more on this subject read the Everybody is Blowing Bubbles commentaries.
The Great O’Neill offers investors a lifeboat - real diversification. Our performance is uncorrelated to long only stock, bond, commodity and property investments.
The Great O’Neill buys (long) and sells (shorts) futures contracts in stock indices, government bonds, commodities, currencies and volatility derivatives. Our preference is for some prices to go up and for some to go down. For example, we may be betting on higher stock market prices and lower oil prices in January and for higher oil prices and lower stock market prices in June.
The Great O’Neill has a positive track record that is unrelated to a rise or fall in stock, commodity and property markets. Most ‘investment product’ sales people are unaware of their ‘products’ symbiotic relationship to artificially low interest rates. The central banks' money printing umbilical cords reach far and wide and have infected virtually every investment on the planet.
Thankfully our trading performance is not dependent on low interest rates. See our commentary – Interest Rates – Part I – A Broken Market Place.