Today on the blog we are picking up where we left off with Top Dogs, a special 12-part series focused on building and managing larger accounts (~$250k to $2.5 million).

The Top Dogs team recently aired their ninth segment in the series, which involved revisiting the core portfolio and comparing its success versus a more traditional buy and hold strategy.

As a reminder, the Top Dogs’ core portfolio included five underlyings: SPY, IWM, TLT, GLD, EEM. There were 243 theoretical combinations of long and short portfolios that could have been assembled from these five names.

Interestingly, these 243 random portfolios averaged $0 since the airing of the show covering this topic (roughly 8 weeks before this post). The most profitable of the portfolios made $11,400, while the weakest lost $11,400. These two portfolios on the extremes of the profit and loss spectrum included the opposite positions in the same symbols.

A chart depicting the distribution of profits from the 243 random portfolios is shown below:

Contrary to the random results above, the portfolio designed by the Top Dogs team (including hosts Tom Sosnoff and Tony Battista) involved deploying trades based on their assumptions and forecasts for the market. It should be noted that since the first Top Dogs show, average and mean implied volatility has centered around 23.

The results from Tom and Tony’s core portfolio, shown in the graphic below, indicate that the portfolio hand-selected by the Top Dogs team netted some impressive returns - namely over $7,000 in profit:

Taken in sum, the above means that the tastytrade Top Dogs portfolio outperformed all random portfolios by an average score of +$7,745 to $0. That meant the tastytrade portfolio ranked in the top 95% of the random portfolio outcomes - as seen below:

We hope you will take the time to view the entire ninth installment of Top Dogs when your schedule allows.

If you have any questions about this episode, or any in the 12-part series, we encourage you to contact us at support@tastytrade.com

Stay tuned, another Top Dogs will be coming your way soon!

Sage Anderson has an extensive background trading equity derivatives and managing volatility-based portfolios. He has traded hundreds of thousands of contracts across the spectrum of industries in the single-stock universe.