Active Risk Management
Rules-based options strategy with time-based signals and volatility monitoring
A disciplined, rules-based options strategy designed to generate returns while actively managing downside risk. Our tactical approach uses time-based entry and exit signals combined with real-time volatility monitoring and systematic position sizing to navigate market conditions with institutional-grade risk controls.
Our Approach
Our proprietary time-based framework generates entry and exit signals independent of price predictions. This removes the guesswork from trade timing and ensures disciplined, repeatable execution across all market conditions.
Real-time volatility data feeds into our position sizing models, dynamically adjusting exposure based on current market conditions. When volatility rises, position sizes automatically decrease to maintain consistent portfolio-level risk.
Multiple layers of risk controls — from individual position stops to portfolio-level exposure limits — ensure that no single trade or market event can cause outsized losses. Capital preservation is always the first priority.
The tactical option strategy is designed to complement our HTO-optimized core allocations. While HTO addresses long-term portfolio construction, the tactical overlay actively manages short- to medium-term risk through options markets. Together, they form a comprehensive risk management framework that addresses both structural portfolio risk and dynamic market conditions.
Hypothetical Performance Limitations: The performance results shown above are hypothetical and based on backtested data. Hypothetical performance results have many inherent limitations, some of which are described below. No representation is being made that any account will or is likely to achieve profits or losses similar to those shown.
In fact, there are frequently sharp differences between hypothetical performance results and the actual results subsequently achieved by any particular trading program. One of the limitations of hypothetical performance results is that they are generally prepared with the benefit of hindsight. In addition, hypothetical trading does not involve financial risk, and no hypothetical trading record can completely account for the impact of financial risk in actual trading.
For example, the ability to withstand losses or to adhere to a particular trading program in spite of trading losses are material points which can also adversely affect actual trading results. There are numerous other factors related to the markets in general or to the implementation of any specific trading program which cannot be fully accounted for in the preparation of hypothetical performance results and all of which can adversely affect actual trading results.
Options Risk: Options involve significant risk and are not suitable for all investors. The risk of loss in trading options can be substantial. Before investing in options, investors should read and understand the Characteristics and Risks of Standardized Options published by the Options Clearing Corporation. Past performance is not indicative of future results.
Dreams Investment Solutions LLC is an SEC-registered investment adviser (CRD #339186). Registration does not imply a certain level of skill or training. This material is provided for informational purposes only and does not constitute investment advice or a recommendation to buy or sell any security.
Schedule a confidential conversation to discuss how our tactical option strategy can enhance your risk management framework.