The structure of two portfolios
There are complex investment strategies associated with buying a portfolio of assets and the simultaneous selling of another portfolio. Within Geworko Method one portfolio is base, another one is quoted – in the process of trading when buying such a PCI, the components of the base portfolio are bought and the components of the quoted portfolio are sold. For example, a trader can implement a strategy of buying U.S. stocks and selling European indexes in certain investment periods and reverse strategies in other periods. For that a PCI is composed "(DJI + SP500 + Nd100) / (DE30 + GB100 + FR40)" with component weights equal to each other (in dollar prices of respective CFDs on indices).
Analysis and trading of such complex portfolios can be included in a new class of pair trading on two portfolios (in its objectives and results, this scheme is similar to spread trading of portfolios).
In order to work with PCI by GeWorko Method, you should download the terminal and open an account in NetTradeX platform.
You can learn how to create and use PCI through GeWorko Method on NetTradeX terminal on "Quick Guide" page.
We also regularly publish articles on the application of GeWorko Method in "Articles about the method" section.