Over Gnomon Alpha's seven-year track record, we have been the trading strategy that "did well when equities fell". In March 2020 and throughout 2022, Gnomon posted some of its strongest performances. And before Gnomon, my prior firm, 2100 Xenon, earned 43 percent in 2008. The bear-market trading DNA is ingrained in what we do. 

Recently, we have improved our strategy to better exploit stock market selloffs by adding our new Sigma trading model. Sigma is a trading model that only "shorts" equity indices. It is an addition to our Vega model, which has successfully done that since 2007. While Vega can hold onto bearish trends for up to 2 months, Sigma cannot hold a short position for more than eight trading days. Vega has an average holding period of 8 days. Sigma has a one-day average holding period. Finally, Vega is super selective and might not trigger for years. Sigma, meanwhile, often triggers several times per month. 

The reason for the short Sigma window is that the Trump World is defined by sudden, exogenous shocks to the equity markets that correct themselves in days but can be quite painful until they do. Impromptu Trump tariffs, Federal Reserve angst, military deployment, diplomatic breakdowns, and unexpected political appointments all cause equity market dislocation. And Sigma is designed to exploit those short-term calamities. 

So far, Sigma has traded 13 times since its inclusion in our portfolio on September 1, 2025. Ten of those trades have been profitable. Also, since Sigma's inception, Gnomon GM (12V) has returned 5.05 percent over three months. Sigma contributed 40 percent of those profits. It has added 2.03 percent to the return since its inception.

History says that the stock market can go for long periods without the sort of trending markets we have experienced in the last few years. Yes, the overall trend with stocks is clearly positive, but symmetrical trading over short periods is more the rule than the exception over the life of the stock market. Sigma is designed to profit from those environments. Never bucking the trend but skimming the profits from short-term volatility.