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a Bull & Bear hybrid portfolio

We have all heard the old adage Bulls make money. Bears make money. But what we dont hear is how to make money on both sides of the trade. Your bullish portfolios have most likely stumbled across unforeseen bearish obstacles in the past. The move might have been temporary or even transitory. What ever the situation, it is never easy to explain to clients temporary losses at the end of the quarter, whether they are on paper or real dollar losses. The Hardline portfolio is managed by a proprietary trading algorithm which utilizes SPY (SPDR S&P 500) and the SH (ProShares Short S&P500) ETFs. Regardless of market sentiment, emotion, geo-political risk, or sovereign default risk, the algorithm seeks profitable trades, providing clear signals when to enter and when to exit trades in bull or bear market moves, updated on a daily basis. Based on these signals the portfolio will be either long the SPY, long the SH. At times when indicated by the algorithm, portfolio allocations can be held entirely in cash, awaiting for the appropriate entry point to trade. If the algorithm signals cash, why risk it on a trade. The charts and information below show back tested portfolio performance from 2008 to date. The time-tested, technology driven, and disciplined algorithm and offers consistent, highly profitable results..showing how you can tame the bulls and the bears.
Copyright 2011 Strategic Options, LLC

Strategic Options, LLC

Hardline Portfolio

Strategic Options, LLC

Portfolio Characteristics
Average trade per year Average duration of trades Max Gain From Trade Max Loss from Trade Total return from Jan 08 to Jun 11
34 15 28.08% -5.46% 417.0%

The Hardline portfolio is designed to generate double digit returns in excess of the S&P 500 in bear or bull markets.

The Hardline portfolio utilizes a proprietary trading algorithm to determine position entry and exit points for the portfolio components. The Hardline portfolio utilizes the SPY (SPDR S&P 500) and the SH (ProShares Short S&P500) ETFs. Positions are adjusted when triggered by the algorithm. Trade cycles are determined by the volatility of the market. They will typically shorten with higher volatility. The Portfolio will be either long the SPY, long the SH, or on occasion, in cash when the algorithm indicates cash as the prudent position for the portfolio assets.

Hardline Portfolio vs. S&P 500

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Monthly Performance
Jan 2011 2010 2009 2008
2.5% 0.4% -1.3% 0.0%

3.4% -0.4%

-1.2% 5.8%

2.7% 1.3% 9.7% 1.8%

-4.1% 4.1% 10.0% 2.7%

7.0% 9.1% 2.1% 12.3%

-1.9% -0.7% 8.4% 0.8%







S&P 500

3.4% 15.1% 26.5%

6.2% 3.9% 0.0%

0.3% 2.8% 6.2%

3.8% -1.8% 13.9%

0.0% 2.8% 3.9%

6.0% 1.4% -3.1%

41.0% 44.0%

11.6% -10.4% 1.9% 0.9%

54.0% -37.0%

Copyright 2011 Strategic Options, LLC

The returns presented here are hypothetical, based on Strategic Options LLC algorithms. The returns reflect the reinvestment of any income and dividends received on securities represented in the indices. Actual account returns will vary depending on the custodian clients select for their accounts and the instruments available for investment through each custodian. In situations where there is no optimal investment option for a particular allocation on the clients chosen custodial platform, a position is either left in cash or the best available alternative is utilized. This is not the recommended solution and Strategic Options, LLC can not be held responsible maintaining returns. Returns do not reflect management fees which are typically deducted quarterly. All potential purchasers should carefully review the Prospectus, including the Risk Factors described in the Prospectus. You should always consult a competent tax advisor regarding the implications of this product, or any use of this product in your particular situation. ACTUAL NET PERFORMANCE WOULD BE FURTHER REDUCED BY THE MANAGEMENT FEES ASSOCATED WITH MUTUAL FUNDS, ETFS, AND NOTES, AS WELL AS ANY COMMISSIONS OR TRANSACTION COSTS THAT WOULD BE BORNE BY THE INVESTOR. INVESTING INVOLVES THE POTENTIAL FOR GAIN AS WELL AS THE POSSIBILITY OF LOSS. PAST PERFORMANCE DOES NOT GUARANTEE FUTURE RESULTS. The Hardline portfolio is different from many portfolios in that it seeks inverse leveraged returns and only on a daily basis. The Fund has more risk than similarly benchmarked exchange traded funds that do not use leverage. Accordingly, the Fund may not be suitable for all investors and should be used only by knowledgeable investors who understand the potential consequences of seeking daily inverse leveraged investment results. In any case, investors should always actively monitor their investments. DEFINITIONS: The S&P 500 Index is an unmanaged market indexes and cannot accommodate direct investment, include the reinvestment of dividends and interest, do not include management or transaction fees and do not consider taxes. S&P 500 is a registered trademark of The McGraw-Hill Companies, Inc. SPY ETF: The investment seeks to replicate, net of expenses the S&P 500 index. The index is composed of 500 selected stocks, and spans over 24 separate industry groups. It is heavily weighted towards stocks with large market capitalizations and represents approximately two-thirds of the total market value of all domestic common stocks. The fund holds all of the S&P 500 index stocks. It is comprised of undivided ownership interests called SPDRs. It issues and redeems SPDRs only in multiples of 50,000 SPDRs in exchange for S&P 500 index stocks and cash. SH ETF: The investment seeks daily investment results, before fees and expenses, which correspond to the inverse (opposite) of the daily performance of the S&P 500. The fund invests in derivatives that Proshare Advisors believe should have similar daily return characteristics as the inverse of the daily return of the index. It invests typically the rest of the assets in money market instruments. The fund is non-diversified. IWM ETF: The investment seeks to replicate, net of expenses, the Russell 2000 index. The fund invests at least 90% of its assets in the securities and in depositary receipts representing securities of the index. It invests in approximately 2000 of the smallest capitalization-weighted companies in the Russell 3000 index. EEM ETF: The investment seeks investment results that correspond generally to the price and yield performance of, before fees and expenses, of the MSCI Emerging Markets Index (the underlying index). The fund generally invests at least 90% of assets in the securities of its underlying index and in depositary receipts representing securities in its underlying index. The underlying index is designed to measure equity market performance in the global emerging markets. It is non-diversified. DBC ETF: The investment seeks to track changes, whether positive or negative, in the level of the Deutsche Bank Liquid Commodity index a Optimum Yield Diversified Excess Return. The fund will pursue its investment objective by investing in a portfolio of exchange-traded futures on the commodities comprising the index, or the index commodities. The index commodities are light, Sweet Crude Oil (WTI), Heating Oil, RBOB Gasoline, Natural Gas, Brent Crude, Gold, Silver, Aluminum, Zinc, Copper Grade A, Corn, Wheat, Soybeans, and Sugar. The index is composed of notional amounts of each of the index commodities. LQD ETF: The investment seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the iBoxx $ Liquid Investment Grade Index (the underlying index). The fund generally invests at least 90% of its assets in securities of the index and at least 95% of its assets in investment grade corporate Strategic Options, LLC bonds. The underlying index is designed to provide a broad representation of the U.S. dollar-denominated liquid investment grade corporate bond market.

Copyright 2011 Strategic Options, LLC