Our latest investment program from the Thales Securities Asset Management division is designed to take advantage of the current market lows. The markets are in the process of liquidation, lower lows interceded by strong rallies. If history is anything to go by, this market sell off will eventually reverse and those savvy investors with the fortitude and tenancity will profit from the reversal.

Most analists put the bottom between 600 – 800 on the S&P ($SPX), but the reality is that no one really knows exactly how far away is the bottom and how long we may be in this bear market. We can make a technical case for a double bottom, along with the credit stress on the market it may also push down the earnings down to a more historically acceptable level making the argument also for a fundamental case.

Taking a historical look at stocks price to earnings ratio, the best time to buy has been when stocks reach a P/E of around 8 as during the 1981-1982 recesssion. For the period of July 2007 until October 2008 the average P/E ratio of the S&P index has been around 20 whilst the present panic period it has dropped it to around 12.

Its our view that with the current credit crisis and the high likely hood of inflation this will further decay the price to earnings ratio, just has it has done during previous market panics.  Based upon those statistics we believe we have some months of uncertainty in front of us but with the present price to earnings of 12 it is indicative of a possible reversal.

An analysis of 25 previous market declines where made of the Indices prior to 1957 and S&P500 thereafter, what was found that the average duration of the decline was 20 months and the average stock market price declines where between -33% and -37%, does that sound familiar? The average P/E´s for the duration of all declines were 14 and 15. Severe panic declines lasted longer, around 29 months and dropped the markets more severly,  -46%.  Assuming we attain the average, we expect this volatility and uncertainty to possibly last until 2nd  quarter 2009 or 1st  quarter 2010. We don´t believe we will see another great depression and if thats the case we think the market will rebound in the timeframe suggested.

How do we find opportunity in adversity? By understanding where those opportunities lie and capitalising on them.

Our strategy is to average into the growth portion of the portfolio utilizing our actively managed futures trading returns. If the market is still declining, a greater proportion of the fund will be actively traded in our managed futures account. We will determine allocation of units dependant on market dynamics and key areas of the economy which will produce the greatest returns.

We will utilize a variable portion of the fund to purchase index ETF´s, such as the QQQQ´s and the Ultra S&P500 ProShares (SSO). These positions may be hedged using Index options, this could lock in the value of the portfolio to guard against any adverse market movements. This strategy is also known as a protective index collar.

It is our belief that the double digit yields on some Oil Royalty trusts and high quality preferreds will also produce massive capital returns when the market rebounds. We will capitalise on the returns whilst awaiting better market conditions. When the world economy rebounds, demand for oil will return and the price will go up,  as will the price of all commodities.

Key staple stocks such as P&G will also have a place in our portfolio, providing stability during these difficult times. This new investment program is a combination of the managed futures pool and the new managed equities pool. Invest now and profit from the best buyingopportunities since 1982.

Min investment $25,000
Management fee 0.75% (only during the promotion period )
Profitshare 25% on new monthly trading highs on a watermark basis