If you zoom out on the SPY chart bellow and scroll back and forth trough time, you'll see that the market is going up and down all the time. If you think about it the average investor is ether at all time high of it's investment portfolio or in a period of a drawdown. Our goal is to limit the drawdown and still participate in on the upside.

As you can see bellow, the rate of return of the 2 models are very similar, but the downside protection of the quantitative model is exceptional compared to buy and hold strategy.

AI robot created the name Art Invest Model and we think it is beautiful

Contrary to the common believe, investing in S&P 500 is not a passive system, in fact S&P 500 is a trend following active management system by itself: there is a committee responsible for choosing which stocks to be part of the index and also the stocks are equity weighted, which means the stronger one company is, the bigger part of the index it becomes, essentially making it a momentum trend following investment.

The only thing missing from this type of index investment model is the risk management to prevent the regular 50% drawdowns, which are coming sooner or later...

You can see bellow one well known model for risk management model using 200 day simple moving average, basically on the daily SPY chart you can draw a 200 day simple moving average of the closing daily prices and when SPY closes above it generates a buy signal and when SPY closes bellow, generates a sell signal. This model is not as good as our proprietary Art Invest model, and you have to watch the market often to make sure you are not missing a signal, but will give you an idea that it is fairly easy to protect yourself from large drawdowns while keeping similar market returns as in buy and hold system.

We cannot give personal financial advice, but we strongly believe, a portion of someone's portfolio should be invested in a such AI powered, data driven, quantitative model (currently we have approximately 90% of our six digit portfolio invested in this model) and this is how we use it.

The system generates one of the 4 signals each month: Stay Long; Go Cash; Stay Cash, Go Long.

As we continue to contribute to the account each month, as long as the signal is "Stay Long", we continue to buy until the signal changes to "Go Cash", at this point we'll move the whole account to money market fund and continue contributing to it until the next signal change  to "Go Long" where switch everything again.

If we need the money for something short term, in the next 3 - 5 years, like retirement, major purchase, etc, we'll stay in cash and wait for the next buy signal, we might miss a lot of upside with this conservative approach, but it will protect the portfolio better by avoiding investing at the top of the market (worst case scenario)

We are using SPY as an example, because it is one of the the largest and oldest, but the model works with any low cost ETF (iShares IVV, Vanguard VOO, etc), mutual fund (Vanguard VFINX, Schwab SWPPX, Fidelity FXAIX, T. Rowe Price PREIX, etc.) or other investing vehicle mirroring the S&P 500 index.