29 March 2017: BlackRock lays off fund managers

BlackRock announced that it would overhaul its actively managed equities business by cutting jobs, dropping fees and relying more on computers to pick stocks. According to Reuters “the move highlights how difficult it has become for humans to beat the market”. Fund managers take a yearly fee of at least one percent from your portfolio, while the vast majority performs worse than the average index fund on a structural basis. At These Dutch Guys, we are convinced that humans cannot beat the market in the long run. Once emotions get in the way, history has shown that good results are threatened. We use this fundamental insight as the basis for our investment strategy in which we let computer models do the work. Check out the table below for the results. And, BlackRock, eat your heart out: we charge a flat fee of $0 a year…

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U.S. stocks ended sharply higher on Tuesday, with financials and energy stocks leading the way. Data showed that U.S. consumer confidence soared to a more than 16-year high. Major US indices added at least 0.60%. Volatility dropped: the VIX ended more than 7% lower and is now well below 12 points. UVXY ETFs took a blow and lost more than 10%. XIV ETFs gained more than 5%.
All of our models held XIV ETNs during yesterday’s session and profited from this substantial rise. Danny Daredevil‘s return since the start rose to almost 350%. Danny’s AAR is at 234%. Adventurous Anny is up more than 20% since 6 March 2017. Solid Suzy‘s and Lazy Larry‘s return stands at 10% after three weeks of trading.

Model Holds Start date

RSS

YTD

QTD

AAR

Danny Daredevil XIV 1 January 2016

347.36%

10.98%

10.98%

234%

Adventurous Anny XIV 6 March 2017

21.16%

21.16%

21.16%

Later

Solid Suzy XIV 6 March 2017

11.58%

11.58%

11.58%

Later

Lazy Larry
XIV 6 March 2017

11.58%

11.58%

11.58%

Later

RSS = Return Since Start | YTD = Year-To-Date | QTD = Quarter-To-Date | AAR = Average Annual Return

 

Two of our models gave a trading signal at the end of yesterday’s session: Danny Daredevil and Adventurous Anny. Danny switched from XIV ETNs to UVXY ETFs and Anny traded XIV ETNs for cash at the opening of today’s session. Solid Suzy and Lazy Larry keep XIV ETNs in their portfolio.

 

RS_v05-small Thunderclouds gathered over the south of the Netherlands after a warm and sunny day. Moments after this picture was taken, it started to rain heavily and the temperature dropped. As so many other things, the weather goes in cycles. We don’t mind a thunderstorm every now and then. Because we know that there will always be warm and sunny days, before as well as after.