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The Exclusive Signals Stock Trading system uses a basket of about 150 different shares. This basket is examined once a month to measure whether the selected shares still meet the conditions. Because of this, every now and then a few shares in the basket may be changed.
At present, the basket consists of these seven different sectors:
- Communication Services
- Consumer Discretionary
- Consumer Staples
- Healthcare
- Industrials
- Information Technology and
- Utilities
These seven sectors are composed according to the Global Industry Classification Standard (GICS). A total of 11 sectors are classified according to the GICS. Each publicly traded US share is assigned to one of the 11 sectors. For example, both Tesla and Amazon are classified in the Consumer Discretionary Sector.
At present, the basket of shares consists of about 150 different shares that belong to one of the seven sectors mentioned above. Many growth shares are represented in the first six sectors. The Utilities sector often acts as a safe haven when the markets correct.
The system looks for the strongest stocks in the strongest sectors to include them in the portfolio. Often, the selection of stocks consists of two or three different sectors. This sector diversification is designed to reduce risk.
To reduce the risk even further, in addition to the sector spread, three different market indicators are measured continuously. When two (or three) of the three indicators are in the red, a position is temporarily not taken. Many tests have shown that when these situations occur, over a longer period a negative result will be achieved. Moreover, it has a positive effect on the equity curve, which will consequently show less deep drawdowns.
Sincerely,
Henry van Ginkel
