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Merlyn.AI Improves and Simplifies Investing

Wikipedia defines AI (Artificial intelligence) as the ability of a machine to perceive its environment and take actions to maximize its chance of success at some goal. For investors, that usually means higher returns, lower risk and less effort.

  • Merlyn.AI intelligently analyzes and automatically selects from hundreds of ETFs on a monthly basis.
  • Merlyn.AI employs genetic algorithms to continuously evolve strategies as the markets and ETFs change.
  • Merlyn.AI adjusts filters and thresholds to be confident trades are neither too early nor too late to the party.
  • Merlyn.AI integrates StormGuard-Armor and Bear Market Strategies to avoid a large loss in the next market crash.

Merlyn.AI Employs Three Forms of AI

There are over 100 recognized forms of machine learning – neural networks is the most well-known. Merlyn.AI inherits two forms of AI from SectorSurfer and adds a third form of its own. They are: (1) "adaptive algorithms" to evaluate the past character of the data and adaptively tune the filters and thresholds employed to determine subsequent buy/sell decisions, known as Forward-Walk Progressive Tuning; (2) "fuzzy Logic" to evaluate a composite of 12 measures of the market’s character to determine current investment safety, known as StormGuard-Armor; and (3) "genetic algorithms" to evolve the candidate funds in a population of momentum strategies to eradicate remnants of hindsight selection bias, which might reasonably be called "Forward-Walk Progressive Picking."

Sneak PeekImproving Confidence

Hindsight selection bias plagues most back tested strategies because the funds that made a strategy work in the past often do not continue to do so in the future. One generally discovers this too late. Although there are strategy design methods that can avoid this problem, they are generally too difficult for most investors to get right. Our AI Genetic Momentum Portfolio Manager (screen-shot right) removes fund selection hindsight bias using three levels of adaptive and genetic algorithms for fund selection. With Merlyn.AI your ETF selections will never be stuck with yesterday's assessment of their potential.

Click Chart to See Technology Introduction Sneak Peek Video

We Made it Easy to Use      Easy

We’ve posted a set of “Master Merlyn Strategies” that possess a range of investment styles (conservative to aggressive), such as the sector rotation strategy above. When imported into your SectorSurfer account there is nothing more to do but respond to occasional trade alerts, review charts, and go fishing. We’ll manage the complex details under the hood. Check them out.

Note: These Strategies and Portfolios are Available on SectorSurfer. AlphaDroid, and Riskalyze.  

Posted Merlyn Strategies

Strategy Page Link Chart CAGR Sharpe Sortino Description
Merlyn Strategy 7.4% 1.3 6.2

This Strategy seeks to provide investment results superior to the Bloomberg Barclays US Aggregate Bond Index (AGG).

Merlyn Strategy 21% 1.2 9.9

This Strategy seeks to provide investment results superior to the S&P 500 Index using Style Box (growth, value, size) index ETFs.

Merlyn Strategy 19% 1.3 8.8

This Strategy seeks to provide investment results superior to the S&P 500 Index using "investment factor" (dividends, quality, international, growth, value, size, and earnings) ETFs.

Merlyn Strategy 21% 1.4 8.7

This Strategy seeks to provide investment results superior to the FTSE Global All Cap Index using world region index ETFs.

Merlyn Strategy 31% 1.7 13.6

This Strategy seeks to provide investment results superior to the S&P 500 Index using market sector ETFs.

Example Merlyn Portfolios (Others can be made.)

Portfolio Page Link Chart CAGR Sharpe Sortino Description
Merlyn's Magic 26% 1.9 13.9

Allocation: 50% Sectors, 30% Global, 10% Factors, 10% Style Box for the aggressive investor.

Merlyn's Magic 16% 1.5 10.7

Allocation: 40% Bonds, 40% Style Box, 20% Global for the classic moderate risk investor.

Merlyn.AI will do the hard work  ...  while you go have a life!

 We Wrote the Book on Momentum and Risk Reduction


The Seven Faces of Risk

By Scott Juds


''This book is one of the very few 'must read' books. For those who have been burned by the 'diversify and rebalance' mantra, ''Conquering the Seven Faces of Risk'' is sorely needed, and Scott Juds truly delivers. As a fiduciary, I find SectorSurfer's risk mitigation algorithms to be so far superior to the conventional buy-hold-and-rebalance models that I cannot justify risking my clients' assets with the latter. I am impressed with Scott Juds' mission to educate the retail investing community.''

- David Yeh, MD, (Retired Nuclear Physician), Investment Advisor,
   Author of ''The Busy Doctor's Investment Guide''