Strategy types: short, mid, and long term
Time Horizon Classification
Investment strategies are typically categorized by their holding periods and corresponding objectives:
1. Short-Term Strategies (Days to Weeks)
Characteristics
- Holding period: 1 day to 3 months
- Focus: Capitalizing on immediate price movements
- Typical instruments: Liquid stocks, options, futures
QuantWave Application
- High-frequency pattern recognition
- Intraday momentum signals
- News-driven event plays
2. Medium-Term Strategies (Months to 1 Year)
Characteristics
- Holding period: 3-12 months
- Focus: Sector rotations and thematic trends
- Typical instruments: ETFs, sector stocks
QuantWave Application
- Wave cycle analysis
- Seasonal pattern identification
- Mean-reversion setups
3. Long-Term Strategies (1+ Years)
Characteristics
- Holding period: 1-5+ years
- Focus: Fundamental growth and compounding
- Typical instruments: Core portfolio holdings
QuantWave Application
- Macro trend analysis
- Structural support/resistance mapping
- Multi-year fractal patterns
Strategy Comparison
| Metric | Short-Term | Medium-Term | Long-Term |
|---|---|---|---|
| Time Commitment | High (daily) | Moderate (weekly) | Low (quarterly) |
| Turnover | Very High | Moderate | Low |
| Risk Profile | Higher | Medium | Lower |
| Return Potential | Variable | Stable | Compounding |
Choosing Your Approach
- Capital Base: Short-term requires more capital for scaling
- Personality Fit: Active vs. passive temperament
- Resource Availability: Time for research and monitoring
- Market Conditions: Certain strategies work better in specific environments
Implementation Framework
- Define primary strategy time horizon
- Select complementary secondary approaches
- Establish separate capital allocations
- Create distinct performance benchmarks
- Implement appropriate risk controls
Successful investors typically combine elements from all three time horizons, weighted according to their goals, resources and risk tolerance. QuantWave provides analytical tools tailored for each strategy type, enabling informed decision-making across timeframes.