The Big-10 Alpha investment strategy is driven by a proprietary model developed on the Limex Ai platform. The Limex Ai platform allows traders, investors, and analysts to build individualized models to generate trading ideas using powerful machine learning-based infrastructure. See the end of the report for more details on how to use Limex Ai.
Big-10 Alpha Summary for March 3rd, 2025 - trading in volatile times
Weekly Performance: Last week the Big-10 Alpha portfolio gained 0.96% compared to a loss of (0.53%) for the S&P500. With this, the portfolio accumulates 3.67% and 9.26% gains for the past month and 3-months, respectively, compared to losses of (1.30%) and (1.61%) for the S&P500 benchmark.
The biggest drivers of performance were ALL (The AllState Corporation, up 7.3%), RTX (RTX Corporation, up 7.9%), COST (Costco Wholesale Corporation, up 4.0%), and MA (MasterCard Incorporated, up 3.4%). GOOGL (Alphabet Inc., down 5.2%) and ISRG (Intuitive Surgical, down 3.1%) were the main laggards.
Ins-and-Outs: This week the model suggested 4 position replacements and we reduced one to keep the 10-position limit, which is the highest we’ve seen (typically we trade 2 or 3 positions per week). We liquidated long positions on:
- GOOGL Out – combination of weak technical indicators, higher than expected capex guidance, and slight drop in target prices by sell-side analysts. Slight offset is cheaper valuation post sell-off.
- AMZN Out – weak trading technicals, higher than expected capex, and dependance on a consumer in times of worsening sentiment. Strong growth in AWS and advertising are possible long-term tailwinds for the stock.
- AXP Out – rising rates and inflation affecting the asset-heaving lender, and a deteriorating Relative Strength Index (RSI).
- COST Out – toppy chart, despite attractive defensive profile. The model has zig-zagged in and out of the name as a counter-cyclical position hedging market volatility.
- OKE Out – profit trading after positive reaction to 4Q earnings (Feb 24).
- META In – consistently ranked at the top of the rankings, with a much more attractive entry point after re-tracing from $740 to $630. We have traded the name around volatility.
- SPOT In – another name that typically ranks within the 5 highest names, but that we trade around volatility.
- DASH In – re-entering the long position following the drop from a $216 high to $190.
- FTNT In – reversing profit-taking sale at a 7% discount to the last exit point.
Limex Ai is a tool for all users of Limex.
Limex develops and trains macro-models identifying dynamic trends and patterns with that allow to assess the probability of outperformance for each member stock. Investors can tailor their specific strategies to run over these macro-models, selecting their style preferences, sector or market cap filters, risk tolerance requirements, etc.. Once users settle on their strategies, the platform will automatically update it on a weekly basis.
TheBig -10 Alpha strategy is a 10-member portfolio of stocks with market capitalization over $50b listed in the US. The strategy optimizes the risk-return balance of the portfolio by maximizing the expected information ratio of the positions. The evaluation period starts in 2008 and has accumulated an annualized 9.0% alpha over the S&P500 benchmark with a 1.0x Sharpe ratio as of March 3rd, 2025. Since going live in November 2023, the strategy accumulates 22.2% alpha with a 3.26x Sharpe ratio.
