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The Harvest Advisors Flexible Bond Program (“Harvest”) utilizes a momentum-based quantitative model to identify overbought and oversold conditions in the 30-year U.S. Treasury Bond. The Program is very selective in identifying high probability trades, long and short at extremes, and will spend a significant amount of time in cash.
- Interest rates have strong trending characteristics and frequently move in long, steady patterns. The Program will only take positions at the end of those long, steady moves.
- The model utilizes fast and slow stochastic indicators to identify when the 30-year U.S. Treasury is at extreme overbought / oversold conditions.
- Harvest has implemented profit and stop loss targets for each trade including:
- If the Program is up 5% in less than 30 days, it will take profits and exit the trade
- If the Program is up 8% in any period and the model’s RSI (Relative Strength Indicator) is in overbought territory, it will take profits and exit the trade
- If the Program is up 10% in any period of time, it will take profits and exit the trade
- The Program has a 3% initial and trailing stop loss
- The Program will trade about 3-4 times a year and historically spends about 55% of the time in cash.
The Flexible Bond Program uses the ProFunds U.S. Government Plus Fund and the ProFunds Rising Rates Opportunity Fund to execute its strategy. These funds are designed for active portfolios and incorporate modest leverage. The funds seek to provide investment returns that correspond to 125% of the daily performance (or 125% of the inverse) of the 30-year U.S. Treasury bond.
Past performance is no guarantee of future returns.
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