I don't think I need to tell Ray his is wrong... and his posts below confirm that further. He knows very well exactly how the spreadsheet would need to run to account for the voatility risks, and he's saying he refuses to do so.The stated reason is he's standing firm he doesn't believe the risks matter.The unstated reason is doing so would have the naked (unhedged long) positions lose.See, the thing is - it's Ray's spreadsheet, portraying his viewpoint. By showing a 50/50 mix (a few different ways, in fact) he thinks, from his viewpoint, he's provided a way to mitigate the volatility risk that you have brought up. He hasn't done it in the way that you want him to. But then, you haven't hired him, and he has no reason to follow your 'instructions' (which I still think are somewhat muddy*) if he thinks he's provided another way to mitigate the risk.I go back to - it's Ray's spreadsheet, portraying Ray's viewpoint. If you want to portray your viewpoint, you either need to hire Ray, so he has a reason to follow your specific instructions, or portray your viewpoint yourself.AJ* I'm still not clear on how one is supposed to coninually have a reserve equal to 50% of account value without investing the reserves, or selling assets from the account and moving them to reserves, since you have already stated that there isn't any more money to invest/reserve, and the reserves obviously don't grow at the same rate as the account. But, since I have already stated that I think this method of reserving is overkill, I'm not actually all that worried about this confusion.I'm also not clear on why you keep saying that it has to be a 50% reserve, when, by using a 50/50 mix, the max drawdown is less than 50%.
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