How do you work with AVI strategies?

AVI strategies are designed for investors who want to rely less on emotions and forecasts and more on predefined rules. Working with a strategy consists of three simple steps.

Choose a strategy

First, you need to choose the AVI strategy you want to follow. Different strategies have different characteristics:

• some are geared toward higher capital growth,
• others aim to reduce risk,
• still others focus on dividend income.

Before making a choice, it’s helpful to see how the strategy has performed over a long period of time. (See image) These metrics help you understand what behavior to expect from the strategy over a long investment horizon.

Build a portfolio

After selecting a strategy, open the current list of stocks on our website and buy all the stocks included in it. It is advisable to allocate capital roughly equally among all positions.

It’s important to understand that the strategy’s list of stocks is a ready-⁠made investment portfolio, not a set of ideas for you to choose from on your own. The strategies were tested specifically as complete portfolios. Therefore, changes to the portfolio’s composition:

• may improve the result,
• may worsen it.

No one knows this in advance. Historical studies and the actual management of investment accounts pertain specifically to the original version of the strategy.

Rebalance your portfolio

At the end of the period set for the strategy, you need to open the new list of stocks and bring your portfolio in line with it. Typically, it looks like this:

• stocks that are no longer on the list are removed;
• new stocks are added;
• capital is once again distributed roughly evenly.

The update period depends on the strategy. For example, if a strategy is updated every three months, this procedure must be repeated every three months.

If you use multiple strategies

Many investors use several AVI strategies at once. In this case, it is helpful to view each strategy as a separate portfolio. For example:

• the INDIGO portfolio;
• the STABILITY portfolio;
• the DIV portfolio.

This approach allows you to diversify risk and make the behavior of your overall investment portfolio smoother.

The main rule

AVI strategies are designed for long-⁠term investing. Their strength lies not in individual stocks, but in consistent adherence to the rules. Therefore, the main principle is simple: