As the name implies, the Diversified Portfolio is a way to diversify your risk from being in any single strategy. This is accomplished by placing a certain percentage of your portfolio in a number of PING strategies, with the goal of reducing the maximum drawdown risk . Implementing the Diversified Portfolio requires a little math which can easily be set up in a simple spreadsheet. The following example illustrates the process.

We suggest using three of the PING strategies to build the portfolio. These include the S&P 500 Counter Trend, the Nasdaq 100 Hybrid Momentum and the Relative value strategies. To calculate how much to invest in each strategy, you will need three things. First, you need the amount of your investment, otherwise known as the target notional amount. This is the amount of assets you commit to the strategy and remains a constant until changed by you. For example, you might invest $250,000 in the strategy and this amount is what determines how much to invest in each strategy.

Next, take the target percentage for each strategy (provided with the daily signal e-mail) and multiply them by the investment amount. For example, if the target percentage for the S&P 500 Counter Trend strategy is 42.5%, multiply this by the investment amount of $250,000 for a total of $106,250.

Finally, take the $106,250 and divide that by either the per share amount of the Exchange Traded Fund or the contract value of the associated futures contract. For example, if the contract value of the S&P 500 futures contract is $20,000 then divide $106,250 by $20,000 which would result in approximately 5 contracts. This is the amount you would buy or sell depending on the signal direction. Repeat this for each strategy and you will have constructed the Diversified Portfolio.