Investment Approach
MCD Capital focuses on identifying short term market inefficiencies and exploiting them systematically over time. Our overarching goal is to have a scalable complementary portfolio aimed to adapt & perform in various market conditions, enhancing our goal of remaining uncorrelated to major benchmarks and permitting the firm to find or maintain alpha in fast changing market conditions.
"The fund strategy has been trading since May 2022 for a total of 140 weeks to date, each strategy deployed has a historic distribution of returns. For new strategies this is derived from backtested data, for strategies we have been running for a while, we use historic returns. Returns are then validated against historic distribution at the sub-strategy level, and sizing is readjusted. For each desk at MCD, trade by trade P&L reports & environment clustering are used to identify relationships between returns and various market factors such as Carry, Volatility and Option Greeks. These are then ranked using PCA analysis and regression models to identify historical exposure of each book."
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Marceau Dova, Co-Founder & CEO
Two Strategy Books
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The firm is organised in 2 strategy books, each book specialises in different assets, research & trading styles. The first being the Multi-Day (slow) book which trades CME Option synthetic combinations with discretionary execution supported by a quantitative framework, and the Intraday (fast) is Quant book specialising in statistical arbitrage and trend-following algorithmic strategies on CME Futures & NYSE Equities.
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Portfolio-Optimization using margin-based allocation is a critical component of MCD’s strategy. Each pod within our portfolio has its own capacity limitations, allowing us to scale by diversifying allocations rather than merely increasing position sizes. Our goal is to minimize annualized volatility and maximize the Sharpe ratio targeting an inter strategy correlation of -0.20 to 0.20, ensuring a well-diversified return profile.
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This approach allows us to adapt to changing market conditions, with baskets of strategies underperforming or outperforming as the market evolves, ensuring we always have productive trading opportunities and avoid periods of inactivity. Allocations are re-evaluated bi-weekly based on current market volatility and trends. The universe traded is CME Futures, NYSE Equities & Options.
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Fees & Other Information
OUR PARTNERS
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LEGAL DISCLOSURES
The information contained herein is provided for informational purposes only and does not constitute an offer to sell or a solicitation of an offer to buy any securities, investment products, or services. Investments involve risk, including the possible loss of principal. Past performance is not indicative of future results.
The investment strategies, techniques, or philosophies discussed may not be appropriate for every investor and are subject to change without notice. Clients should consider their investment objectives, risk tolerance, and financial circumstances carefully before investing. All investments carry risk, and there is no guarantee that any investment strategy will achieve its objectives.
The contents of this material should not be construed as legal, tax, or accounting advice. Clients should consult their own professional advisors on these matters. Registration as an investment adviser does not imply a certain level of skill or training. Any references to market or economic trends are based on current information, which may be subject to change without notice.
MCD Capital is not authorized or regulated by the UK Financial Conduct Authority (FCA) or any other financial services regulatory authority. MCD Capital does not act as a custodian of client funds and does not hold or safeguard assets. The firm provides trading services only and operates on an execution and advisory basis. Any investments made through MCD Capital remain in the client’s own account with their appointed custodian or broker. Clients should be aware that the absence of FCA regulation may affect the level of investor protections available to them. MCD Capital operates on the ARB Asset Management platform for the provision of its services.
FUTURES AND OPTIONS TRADING HAS LARGE POTENTIAL REWARDS, BUT ALSO LARGE POTENTIAL RISKS. YOU MUST BE AWARE OF THE RISKS AND BE WILLING TO ACCEPT THEM IN ORDER TO INVEST IN THE FUTURES AND OPTIONS MARKETS AND IN ORDER TO INVEST IN THE COMPANY. DO NOT TRADE OR INVEST WITH MONEY YOU CAN’T AFFORD TO LOSE. THIS DOCUMENT AND ITS CONTENTS ARE NEITHER A SOLICITATION NOR AN OFFER TO BUY OR SELL FUTURES, STOCKS OR OPTIONS ON THE FUTURES OR OPTIONS MARKETS. . THE PAST PERFORMANCE OF ANY TRADING SYSTEM OR METHODOLOGY IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS.