How do we tactically trade a biblically responsible investment portfolio?

Tactically trading a biblically responsible investment portfolio starts with the rules inside your selected investment model. In our faith-based models, we start by strength ranking our screened list of companies. The top 50 stocks are eligible for tactical trades.

Tactically trading a BRI portfolio involves making trades that respond to the environment of the market and follow the rules of a given investment strategy. In our faith-based investment models, we have a system that helps us determine on a daily basis which stocks could be candidates for tactical trades. Our system provides us with a range of data and information that helps us make that decision. Most importantly, this system helps us strength rank each stock in our pool of screened stocks. In our faith-based models, we only tactically trade the top 50 positions.


How are the top 50 stocks selected?

As we mentioned earlier, the process begins by a process called strength ranking. Strength ranking is like observing a race and listing all the racers by their performance from best to worst. In the case of stocks, we use price movements as the key indicators. We also will pay attention to other indicators such as momentum, rating values and others.


The top 50 stocks are eligible for tactical trading.

Each trading day begins with a re-evaluation of the top 50. All 50 companies are eligible for tactical trades. Our trade team will begin by placing a buy for the given stock. As per the rules of the faith-based investment models, the trade will seek to reach a 2% gain. Once we reach that goal, our trade team will then sell out of the position. At that point, as long as the position is still trending, we will continue to attempt to make another trade. At this point, we are looking for the price of the stock fall another 1%. Once, the price goes down by that 1%, our trade team will repeat the process: buy and then reach for another 2% gain. The results of this trading strategy can be viewed by looking at our faith-based trade blotter.


The purpose behind tactical trading.

The goal behind tactical trading is to reduce the overall effect of market volatility on a portfolio. This is unlike a buy and hold strategy, which rides out the downturns that come with market volatility. Tactical trading allows us to identify volatility and respond to it. On the macro-scale, this means paying attention to the momentum of a stock. On the micro-scale, this means we can respond intraday to the day-to-day and week-to-week price movements. An active and tactical approach to trading does have certain tax considerations that need to be made.  Please consult legal or tax professionals for specific information regarding your individual situation.  

For more information, please talk to your advisor.


Faith Based Investing (“FBI”) and Biblically Responsible Investing (“BRI”), used interchangeably, are subject to investment risk which is the chance that the position screened for BRI criteria may underperform the market as a whole or in the aggregate. The model selects securities for inclusion based on Faith based screening criteria therefore the model may forgo some market opportunities available to investments that don’t use these criteria.

Harvest’s screening and assessment of a company, based on the company’s level of involvement in certain business dealings, may differ from that of other investments or an investor’s assessment of such company. As a result, the companies deemed eligible may not reflect the beliefs and values of any particular investor and may not exhibit positive or favorable BRI characteristics and is subject to change from time to time. The evaluation of companies for BRI screening or integration is dependent on the data deemed to be accurate and thorough.

Past performance is no guarantee of future results. Information provided in this video and website is for educational and illustrative purposes only and should not be construed as individualized investment advice. The investment or strategy discussed may not be suitable for all investors. All investments involve risk, and although our rules-based investment process utilizes downside risk controls, loss of principal can still occur. Principal values and investments returns are neither guaranteed nor issued by, guaranteed by, or obligations of a bank, savings and loan, or credit union; and are not insured or guaranteed by the FDIC, SIPC, NCUSIF or any other agency. Current holdings are subject to change at any time without notice. In addition to the normal market risk associated with equity investing, investments in small and mid- cap companies tend to exhibit higher volatility and may be less readily marketable than investments in larger companies. Also, international investments involve special risk consideration, which includes currency fluctuations, lower liquidity, economic and political risk. The S&P 500 Index is an unmanaged group of securities considered to be representative of the stock market in general, and its performance is not reflective of the performance of any specific investment. Investments cannot be made directly into an index.

Historical returns data are calculated using data provided by sources deemed to be reliable, but no representation or warranty, expressed or implied, is made as to their accuracy, completeness or correctness. This information is provided “AS IS” without any warranty of any kind. All historical returns data should be considered hypothetical.

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