Personal Investment Strategy – A Multi-Layered Approach

I use a mix of strategies for my personal money and our family retirement programs. Here is the way I do it..

Strategic (monthly)

My goal is to have long term market participation;

In this area, I am usually fully invested unless strategic market conditions move me to reduce exposure. I use no load, no transfer fee mutual funds as the base for this strategy. I look at long term trends and consider the entire world market in my analysis. I use this approach to manage my work retirement programs which have a very limited set of broad indices (6 total) to invest in.

Operational (weekly):

My goal is to stay aligned with dominant theme driving current market conditions

The market in this time frame is driven by a combination of region, business cycle, business sector, style, and market capitalization size; It is always a mix of these in some fashion. I use sector and regional Exchange Traded Funds (ETFs) to shape my intermediate holdings by making weekly adjustments. I let price performance push me towards those ideas that are working. I use momentum, volatility and relative strength to guide my allocation. Market conditions cause me to cycle between 0% and 100% allocated.

Tactical (daily):

My goal is to carefully seize short term opportunities.

My preferred techniques include swing trading, position trading, intraday and over night short term trading. In this portion of my portfolio I am trying to exploit short term anomalies in the market that appear from time to time. This form of trading has high degrees of difficulty and stress. It is only suitable for traders who are willing to make this their profession. Position sizing, risk management, self discipline, frequent after action reviews, and close attention to exit strategies are absolutely critical for success in this area.

Asset Allocation

My allocation of money to each of these areas is a function of how well each is performing. 10 years ago, I was about 80% Strategic with 10% each in Operational and Tactical. Currently I am at 40%, 40%, 20%. Changing allocation percentages between timeframes has been intuitive. I generally adjust quarterly and annually. How to decide on asset allocation is a function of personal strengths and commitment to follow through with the required discipline to make these types of strategies work.


The Strategic/Operational/Tactical model comes from my military background; I think it translates well to the investment arena.. Good luck!