The Seasonal Trade Portfolio

The Seasonal Trade Portfolio consists of a series of trades that tend to occur about the same time each year (hence, the name SEASONAL trade). An example would be the upward move that occurs in Heating Oil as winterapproaches.

The Seasonal Trade Portfolios were first published in 1986 which provides a large base of real time usage.

Nine primary markets are analyzed in constructing The Seasonal Trade Portfolio, the main markets being Treasury Bonds, Heating Oil, Sugar, Deutschmark, Pork Bellies, Wheat, Soybeans, Lumber, and Gold. All the major economic groups are represented thereby providing DIVERSIFICATION, an important element of the program.

Supplementary trades which "fill in" the periods when the nine core markets do not have many positions open are added as well. These supplementary trades include such markets as T-Bills, Eurodollars, Copper, Platinum, British Pound, Oats, Crude Oil, Canadian Dollar, Japanese Yen, Gasoline, Live Cattle, Feeder Cattle, Live Hogs, Corn, Kansas City & Minneapolis Wheat, Soybean Oil, Soybean Meal, Cotton, Coffee, Orange Juice, and Cocoa. "High dollar" markets like the S & P 500 are excluded. There are approximately 75-125 trades per year.

The required margin is targeted at $15,000 but typically ranges from around $13,000 to $17,000. Additionally, there have in the past been periods when the margin requirements have, for very short periods, attained the very low $20,000 area due to trades that have overlapped or otherwise been added.

Please note that margins vary from firm-to-firm and are constantly changing. Margins listed with each quarter's trades are current at the beginning of the quarter and are the margin requirements provided by the various exchanges.

The ideal entry and exit dates which historically have been the best time of the year to enter and exit a particular market are provided in the portfolio. Additional information includes the average profit (in DOLLARS) attained each year, the percentage of times that the trade has worked (RELIABILITY), and a suggested stop-loss value (CONSISTENCY). Some investors use the entry and exit dates and stop levels that we provide and enter/exit on the close of the appropriate day. This approach is not suggested, however, nor is it now acceptable as a condition for entering the program. What is now required as a condition to entry into the program is that a market-timing system be used by each Portfolio Participant as a filter to further enhance profits.

A market-timing system is a trading approach or technique that the investor can use to provide mechanical buy and sell signals. Examples would be moving averages, trendlines, Gann angles and lines, Elliott Wave counts, cycles, telephone hotlines, RSI, OBV, Momentum, % R, Stochastics, Market Profile, and the like.

Simple! If the seasonal were up, the investor would only trade from the long (buy) side. Likewise, if the seasonal were down, only short positions would be initiated. As an example, assume that a gold seasonal is listed as "up" in the portfolio and a trader is following the price of gold with a five day moving average. Long positions would be held so long as the average was moving higher because the seasonal and the trading technique would both be pointing "up" and would be CONFIRMING each other. When the average turned "down", positions would be exited because the seasonal would be in CONFLICT since the seasonal would be pointing "up" and the trading technique "down". Use of a trading filter or technique will allow one to enter and exit trades a little earlier or later than the exact seasonal dates listed in the portfolio. We normally suggest that portfolio participants begin following the seasonal with a favored trading technique about 10 calendar days prior to the listed entry date. In our gold example above, for instance, if the moving average were to turn "up" and suggest that the seasonal was beginning to move a few days earlier than normal, the trader would likely want to take advantage of that early strength by entering a long position prior to the scheduled entry date since to wait for the official entry date listed in the portfolio would be rather foolish.

HENCE, WITH ONLY AN AVERAGE FILTER, IT SHOULD BE POSSIBLE FOR THE INVESTOR TO SUBSTANTIALLY ENHANCE THE PERFORMANCE OF THE SEASONAL TRADE PORTFOLIO.

The reason a trading system is not incorporated is for two reasons; First, the integrity of the work will be better preserved if everyone is NOT placing orders on the same day and at the same price thereby allowing floor traders to "run the stops". If investors' orders are entered over several days at different price levels because of different filtering techniques, all should share in greater long term continued success. Second, not everyone can operate the same trading technique with proficiency. As an example, one trader might be comfortable using a moving average system yet might "choke" if forced to use Elliott Wave patterns while the reverse might be true of another. Also, beginning in 1989, pre-filtering was introduced in The Seasonal Trade Portfolios. The Portfolios are thus no longer pure "seasonal" portfolios, but are now pre-filtered and weighted with information from the award-winning "$upertrader's Almanac". Although the pre-filtering is not extensive, it does appear to have had a beneficial effect since 1988 as can be seen from the results included at the end of this letter.

PROSPECTIVE PARTICIPANTS WHO DO NOT ASSERT THAT THEY HAVE A DEFINED FILTERING METHOD AND THAT THEY WILL FILTER THE TRADES ARE NOT ACCEPTED INTO THE PROGRAM.

VERY! Folks who are familiar with Frank Taucher know that he does his homework! Markets have been researched starting in 1968 or the first trading day, whichever first occurred. Many of these seasonals have worked since the Johnson Administration, through Nixon's wage and price controls, the Vietnam War, the 1973-74 recession, the 1970's inflation and 1980's deflation, bull markets, bear markets, and so on.

Q. What is the reliability of the trades and how have the portfolios performed?

The RESEARCHED portfolios have historically been about 75 % to 85 % accurate but vary from quarter to quarter and have typically PROJECTED over $35,000 average gross profit for the quarter after subtracting a $100 per trade commission and slippage assumption.

NOTE THAT EACH QUARTER'S PROJECTED RESULTS (made before the quarter begins) WILL DIFFER FROM EACH QUARTER'S BILLABLE RESULTS (made after the months of each quarter end) WHICH WILL ALSO DIFFER FROM AN INDIVIDUAL PARTICIPANT'S ACTUAL RESULTS (do to the participant's advantage in being able to assess current market conditions and filter the seasonal trades. Trades in future quarters will vary from the above parameters, either up or down).

Q. Are you saying that a $15,000 account will, in an average year, based on historical research and present margin rates, make over $20,000 per quarter?

Yes, IF history repeats itself and IF ALL THE TRADES ATTAIN THEIR PROJECTED AVERAGES (an event which is unlikely to happen - some trades will do better than their averages and some will do worse). Note that these are PROJECTED results BEFORE each quarter's trades are made. Again, BILLABLE results, or what actually HAPPENS each quarter, will differ from PROJECTED results. The history of BILLABLE results is listed at the end of this letter. To again reiterate, BILLABLE results will also differ from the Participant's actual ATTAINED results due to the ability of some Participants to employ filtering methods that better avail themselves of varying market movements. Some participants will thus outperform the BILLABLE results while others will underperform.

Simple. A downpayment and signed agreement is all that is required to obtain the work.

The agreement states, among other things, that you will not copy, communicate to others, or otherwise plagiarize the work AND INCLUDES PENALTIES IF YOU DO. To 99% of the purchasers, this provision will not apply. It is the 1 % who necessitate its inclusion. You must also assert that you have experience trading markets, that you have risk capital to use, that you understand the principle of filtering explained above, and that you have a trading technique that you can use to filter the portfolio's trades. In short, you must assert that the program is SUITABLE for you given your family and financial circumstances, your age and psychological profile, and so on.

The agreement also states the terms of payment for the balance of funds due on the purchase of the portfolio. Portfolio Participants may pay for the research with one of the following four payment plans:

2. An initial $1,000 deposit and 23 monthly payments of $500 thereafter ($12,500 total),

3. An initial $1,000 deposit and 56 monthly payments of $250 thereafter ($15,000 total), OR

4. An initial $1,000 deposit and 10 percent of the monthly billable profits for 60 months.

At the end of each month, all profits are added together and all losses subtracted for all trades that were scheduled to close during the month by using the average of the open, high, low, and closing price on the entry and exit date listed in the Portfolio adjusted for the stops (one contract per trade). If the result is positive, 10% of the resulting figure is billed to the Portfolio purchaser. If negative, the loss is carried over to the next month and subtracted from the next month's results.

New program participants are sent the quarterly Portfolio currently in progress. Billings for trades do not begin until the next month and begin with those trades which open that month. Hence, new entrants have the luxury of using the information on trades already in progress. Hopefully, this process will allow a cushion to be built in advance of actual billable trades. The process has the added benefit of allowing for a slow buildup of trades over the first few months as trades are "phased in".

That is your choice. There are two basic ways that you can outperform the Portfolio trades:

Please note that you may also not trade the Portfolio at all or may just trade those positions in which you have interest BUT THAT THE MONTHLY BILL WILL BE FIGURED BASED ON THE ENTRY AND EXIT DATES AND STOPS FOR EACH MARKET LISTED IN THE PORTFOLIO REGARDLESS OF WHETHER OR NOT YOU HAVE MADE THE TRADES AND REGARDLESS OF HOW MANY CONTRACTS YOU MAY HAVE CHOSEN TO TRADE.

We are not "managing" or "guiding" your account in any way whatsoever. You have absolute and complete control over your account, funds, and all trading decisions. What we are selling is research.

The portfolios are updated quarterly and provided free of additional charges until the portfolio is fully paid. After payout, Portfolios are provided on a quarterly basis for a preparation and mailing fee presently set at $62.50 per quarter but subject to change due to inflation, etc. This rate has not varied since the program's inception. PLEASE NOTE THAT EACH QUARTER'S UPDATES WILL CHANGE THE MARKETS AND NUMBER OF TRADES THAT ARE IN EACH PORTFOLIO AND THE RESULTING GROSS PROFIT, ENTRY DATE, EXIT DATE, AND STOP PARAMETERS.

The changes may result in either more or fewer trades. Hence, you will always have updated, current information.

YES! Which makes it all the more important that the program you enter be one that has a period of proven success. The Seasonal Trade Portfolio provides that important characteristic.

The people who have been with us since program inception have had the chance of seeing their original $15,000 investment grow to over $45,000 the first year. If they had removed $15,000 from their account and started the second year by trading two units of The Seasonal Trade Portfolio ($30,000), their account would have been worth over $75,000 at the end of 1987. They again could have withdrawn $15,000 and could have traded 4 units of The Seasonal Trade Portfolios ($60,000) in 1988. At the end of the year, the account could remove over $19,000, be worth $75,000, and be ready to trade 5 units in 1989. At the end of 1989, they could have withdrawn over $140,000 and, with their $150,000 account, be ready to trade 10 units in 1990. Those 10 units would have passed the $1,000,000 mark mid year, 1990.

Now, ask yourself, ARE YOU AWARE OF ANYTHING THAT WOULD HAVE ACHIEVED THE ABOVE WHILE ALLOWING PARTICIPATION ON A PAY-AS-YOU-GO BASIS?

When placed in proper perspective, the Portfolios are thus not expensive at all, but are really quite cheap! (Past performance is, of course, no guarantee of future success).

Such is not anticipated and is not expected (it never is when investment programs are entered). However, in order to provide downside protection for Portfolio Participants, an escape clause has been included that provides for the termination of the program if the monthly billings (which are based on a one-contract-per-trade basis) experience a drop of $20,000 from the beginning equity level.

To clarify, if a participant "loads the boat" with 25 Gold contracts that go sour because one of our seasonal trades does not work out, that does not qualify. If the participant loses $25,000 because he cannot follow the trades properly, that does not qualify. If the billings total $20,000 over the next 8 months after a Participant begins our program and then experiences a $25,000 drawdown, that does not qualify (as the drawdown still leaves the investor down only $5,000 from the beginning equity level). It is ONLY from the beginning equity level that the $20,000 "escape clause", as calculated from the MONTHLY BILLINGS, applies.

Hence, with this escape provision, one can rationally arrive at a decision based on a risk/reward analysis. If the program does not work, one roughly knows the downside. If it does work, the upside, as noted above, can be quite large.

Because of this drawdown protection and escape provision, the average Participant should be prepared to finance this program with the initial margin requirements PLUS the maximum drawdown risk of an additional $20,000. If the program participant begins at an opportune time, or if the Participant's filtering method is especially astute, only the initial margin requirement will likely be needed.

If, however, the participant begins just prior to a temporary equity downturn, the initial margin requirement PLUS the extent of the drawdown might be needed. In other words, most Participants will be better served if they approach the Portfolio conservatively and have at their disposal approximately $35,000 of risk capital. Further, once in the program, it is suggested that Participants withdraw the first $35,000 of profit plus whatever amounts are needed to meet program obligations thus leaving the Participant playing with "House" money.

If you need help with a trading system filter, a full-service broker is suggested. The idea would be to take the broker's trades that line up with the trades of the seasonal portfolio. A discount broker is suggested for most traders. If you are not presently using a discount broker, we can help you arrange to have an account opened. Additionally, if you are not familiar with trading filters, we can help direct you to a broker who follows the Portfolios for others and helps them in their trading decisions. We do not participate in the decisions made by these various brokers and have no knowledge of guidance provided, results attained, or fees paid. These arrangements are between the Buyer and the broker.

First, the DIVERSIFICATION that the portfolios provide is the number one strong point. Greater diversification relates directly to increased chance of success and decreased probability of ruin. Second, most of these seasonals (for example, the Heating Oil example cited above) occur because they are reflecting "natural" economic tendencies that occur in nature. As such, they are merely reflecting the natural order of man's environment. The third factor is the long term continued record of success that the portfolios have achieved.

If you enter into this program, you should be prepared for the success of this portfolio! In fact, it is HIGHLY LIKELY that you will be receiving monthly bills for the purchase of the portfolio if you decide to pay based on the monthly BILLINGS!

IF YOU DO NOT HAVE THE DISCIPLINE TO EXECUTE THE TRADES, YOU ARE LIKELY TO FIND YOURSELF IN A POSITION OF HAVING PAYMENTS DUE WHILE NOT HAVING MADE ANY MONEY TO PAY THEM !

As an example, the monthly profits for closed positions that "The Seasonal Trade Portfolio" has generated follow. (Your bill would have thus been for 10% of the following amounts if choosing payment option #4)

MONTH	1986	1987	1988	1989	1990	1991	1992	1993	1994	1995	1996	1997
JAN	581	-1,599	5,322	7,103	3,806	-1,469	3,435	4,408	18,298	10,446	-5,302	-251
FEB	-130	6,953	8,632	-3,224	12,175	3,362	2,980	13,935	-7,767	-6,515	-6,920	13,643
MAR	2,120	10,263	2,617	-1,745	6,963	-1,476	5,361	1,881	2,972	-3,209	1,687	-2,600
APR	-61	-1,842	-2,547	11,646	11,977	-3,859	-386	-4,387	35,564	5,052	10,484	-2,723
MAY	-4,563	1,413	5,701	6,357	12,129	14,089	3,343	-982	12,321	10,881	2,317	11,169
JUN	5,449	-6,032	186	453	7,460	-88	-7,245	7,572	-9,257	-1,014	3,124
JUL	1,494	1,979	-10,803	19,721	19,120	4,039	9,599	2,747	14,840	-423	-1,245
AUG	7,343	8,513	-3,713	-4,903	31,597	-5,465	-704	21,256	-1,462	2,579	14,122
SEP	7,549	-1,757	-5,579	-831	10,567	563	306	-1,749	-6,936	1,357	-9,647
OCT	1,713	261	3,739	2,885	8,859	8,333	2,226	6,972	2,895	-4,907	4,697
NOV	5,975	696	-5,793	10,103	-7,657	3,830	5,691	-2,767	-15,331	2,903	-6,446
DEC	4,627	6,152	10,947	-3,978	-3,002	15,216	8,575	25,820	-43	-5,863	697
TOTALS	32,097	25,000	8,709	43,587	112,994	37,095	34,851	73,806	46,094	11,287	7,569	19,238
AVG/MO	2,675	2,083	726	3,632	9,416	3,091	2,904	6,151	3,841	941	631	1,603

These figures are from the actual monthly billings which are based on trades that CLOSE during each appropriate month (i.e., OPEN or EXITED trades that were scheduled to close in later months are not included in each month's billing which means that each month's total may have been higher or lower than the stated results had the open equity profits been included in the results).

The figures further do not include any commissions paid or interest earned on free funds nor do they reflect the effect of any faxes or optional trades or the benefit of any filtering employed by the individual Participant. In 1993, a fax service was instituted that altered the parameters of the original Portfolio trades. The service was discontinued in 1997 and replaced by the "Trade of the Day" on the World Wide Web.

If you find this program of interest and find it might be suitable to your financial objectives, the next step is for you to order a copy of the agreement. You can do so by calling 1-800-878-7442 or by writing: