We had the pleasure of sitting down with the fine folks from Dominion Capital in our offices on Friday. Dominion, an Attain recommended short-term multi-market program, has begun to bounce off the lows of their current drawdown over the past two months – which was, coincidentally, predicted by both Dominion and Attain (from our year in review ). As we put it,
“the opportunity is ripe for any clients who have been waiting for an opportune time to start a good short term program like Dominion. The fact that entire sector including industry stalwarts like QIM and Crabel had a tough 2010, suggests a value opportunity in the short term arena. In fact, Attain likes this opportunity to invest in a drawdown so much, it has invested $1 Million into the program through its subsidiary Attain Portfolio Advisors.”
They aren’t quite back at equity highs (meaning there’s still opportunity to start investing with them), but they appear well on their way, having earned back about a quarter of the DD with a gain of about 3% so far this year. According to Dominion, the bounce has come from multiple markets, with trading in softs, grains, interest rates, energy and stock futures pushing the program higher.
Per our meeting, they are excited about some new systems and models which have resulted from their ongoing research, and will be looking to expand the program’s diversification with the addition of these models soon. While some new models will make it into their stable of programs, the underlying structure of the program will not change – which is to allocate the most capital to the top performing markets and models in their extensive quiver of programs.
Dominion says that these new models would have helped reduce their drawdown from last Fall (partially by giving them the option to kick out poorly performing models/markets ), but that they were not designed to accomplish that – they were designed to stand on their own.
The flipside of this, though, is that the new models, when implemented, have the potential to slightly increase volatility in the portfolio, if and when all models are active at the same time. Current average margin is in the range of 5%, but with larger accounts incorporating the new models, investors may see a slight increase in margin.