Market Update: Diversified Portfolio 57 Hits New Highs as Q4 Approaches

The Diversified Portfolio 57 surged to fresh equity peaks yesterday, while the Stock Index Portfolio 37 had a strong runup and now sits just $300 shy of new highs. After a sluggish summer marked by choppy, indecisive price action and compressed volatility, the past two sessions have delivered much more favorable intraday trading conditions.

Markets move through distinct cycles, and at times they can drift out of sync with historical patterns. Over-adjusting during these phases often risks missing the mean reversion that eventually brings markets back in line with long-tested strategies.

While most investors tend to focus on long-term charts and macro trends, seasoned day traders learn to read the subtle anomalies that appear inside market cycles. Recognizing these shifts gives us an edge in anticipating when conditions are swinging back in our favor.

With Q4 2025 just a week away, we like the current setup—both into year-end and beyond. The strategies in these portfolios have been developed and refined over many years, not optimized for short-term noise, and they’ve proven their ability to adapt through multiple market environments.

We design these portfolios for a wide range of account sizes—from $25K to $500K—whether trading full-size E-mini contracts or Micros. Each portfolio blends trend, counter-trend, and mean-reversion strategies across major markets including stock index futures, precious metals, crude oil, and cryptocurrencies.

Our key metrics are Average Trade Profit, Profit-to-Drawdown Ratio, and Drawdown Duration. Unlike many in the industry, we don’t lean heavily on the Sharpe Ratio, as it penalizes outsized returns—the very kind we aim to capture.

Beyond the Headlines

It’s important to remember that short bursts of favorable performance don’t define the whole story. One of the biggest mistakes traders and investors make is falling into recency bias—believing that whatever the market is doing now will continue indefinitely. A summer of frustrating, sideways markets can convince traders to abandon strategies at the worst possible time, just before conditions turn. Likewise, a sharp runup can tempt overconfidence. Both extremes can be costly.

Instead, our process emphasizes consistency over conviction. We don’t chase the latest market move or rewrite portfolios based on one season’s patterns. Each strategy has years of testing, designed to weather both favorable and unfavorable environments.

Preparing for What’s Ahead

As we move into the final quarter of the year, our outlook remains constructive—but grounded. Volatility cycles, shifts in liquidity, and macro catalysts like interest rate policy and global events will continue to shape trading conditions. By combining multiple approaches—trend, counter-trend, and mean reversion—we aim to reduce dependence on any single market condition and keep performance more stable across the cycle.

What matters most is not whether the next few weeks mirror the past few days, but whether portfolios are structured to thrive across a broad range of environments. That is the foundation for long-term growth and resilience in algorithmic trading.