Timing, Triggers & Transparency: Inside Potomac Funds’ Tactical Investing Playbook with Dan Russo

Jan 29, 2026

Dan Russo, Potomac Funds’ Portfolio Manager and CIO known for tactical, rules-based quantitative strategies. He talks trading timing over buy-and-hold, focusing on max drawdown and behavioral risks. He outlines Potomac’s trend, breadth, and intermarket three-lens model. He also covers cash as a diversifier, converting technical rules into systems, and why execution and futures matter.

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ANECDOTE

Content Led To The Job

Dan built an audience by posting technical market ideas and charts from home, which led to joining Potomac after interacting with Manish Khada on Twitter.
His content-driven approach helped convert social engagement into a portfolio manager role.

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ANECDOTE

Floor Experience Shaped Risk View

Dan started full-time on the NYSE floor the week AOL bought Time Warner and later lived through two 50% market cuts and the 2020 flash drop.
Those experiences shaped his belief that investors shouldn't be forced to live through large drawdowns.

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ADVICE

Treat Cash As A Position

Use quantitative, systematic rules to decide whether to be invested or in cash instead of trying to catch every market move.
Treat cash as a position and accept being in cash to avoid catastrophic drawdowns.

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Potomac's Content-First Studio and Transparency

00:21 • 2min

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How Social Content Led Dan to Potomac

02:41 • 1min

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Market Commentary, Meme Stocks, and Investor Education

04:01 • 4min

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Tactical Investing: Timing over Time

08:17 • 3min

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Max Drawdown Focus and Behavioral Risks

11:01 • 3min

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Mar Ratio and Upside Capture vs Drawdown

13:41 • 2min

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Why Many Shun Timing and Market Conditioning

16:02 • 6min

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Debunking 'Missed Best Days' Timing Arguments

21:57 • 2min

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Potomac's Three-Lens Market Model

23:34 • 4min

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Quantifying Technical Concepts into Systems

27:04 • 1min

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Binary Systems and Combination Signals

28:22 • 7min

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Working with Advisors and Guardrails Tool

35:42 • 2min

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Diversifiers, Inflation, and the 60/40 Problem

37:34 • 2min

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Avoiding Calls on Macro: Let Data Reveal Regimes

39:22 • 6min

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Cash as the True Diversifier

45:33 • 4min

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Volatility, Options, and Timing Challenges

49:51 • 26sec

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Potomac Bull Bear Strategy Explained

50:17 • 3min

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Expanding Tactics: Leverage, Futures, and Global ETFs

53:30 • 2min

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Futures Addition Benefits and Execution

55:23 • 7min

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Wine Takes: Parkerization and Pinot Critique

In this episode of The Derivative, Jeff Malec dusts off the dress shoes and steps out from behind the webcam for his first in-person interview since before COVID. He heads to Potomac's studio to sit down with Dan Russo, Portfolio Manager and CIO, for a conversation on why investing theory often breaks down when real life shows up. This chat covers why market timing isn't about catching every move, it's about avoiding the ones that cause lasting damage. Dan also explains how Potomac applies systematic, rules-based models built on trend, breadth, and intermarket signals, why cash is a position, and why many popular investing slogans oversimplify risk. SEND IT!

Chapters:

00:00-00:19= Intro

00:20-08:05 = Tactical vs. Passive Investing, Education in Investing, & Understanding Market Timing and Drawdowns

08:06-21:47= The Role of Education in Investing & Analyzing Market Trends and Health

21:48-35:32= Combining Technical Analysis with Market insight

35:33-45:22= Advisor relationships, Portfolio management & Market Psychology

45:23-54:56= Cash as a Diversifier, Tactical Strategies & Risk management

54:57-01:01:53= Future directions, Market Adaptation & The Evolution of Trading

01:01:54-01:06:35= Parkerization and Pinot: Hot Takes on the Modern Wine Industry

Disclaimer: This podcast is provided for informational purposes only and should not be relied upon as legal, business, or tax advice. All opinions expressed by podcast participants are solely their own opinions and do not necessarily reflect the opinions of RCM Alternatives, their affiliates, or companies featured. Due to industry regulations, participants on this podcast are instructed not to make specific trade recommendations, nor reference past or potential profits. And listeners are reminded that managed futures, commodity trading, and other alternative investments are complex and carry a risk of substantial losses. As such, they are not suitable for all investors. For more information, visit⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠www.rcmalternatives.com/disclaimer⁠⁠⁠⁠

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