For August 2011:
S&P 500: -5.4%
80 Fidelity: -5.8%*
80 Flex III: -2.0%
60 Flex III: -1.7%
40 Flex III: -1.4%
For 2011q3 (7/1 through 8/31):
S&P 500: -7.4%
80 Fidelity: -7.1%
80 Flex III: -0.4%
60 Flex III: -0.2%
40 Flex III: -0.0%
For the 10-yr period ending 8/31/11**:
S&P 500: 2.6% per year
80 Fidelity: 4.7% per year
80 Flex II: 11.5% per year
60 Flex II: 10.9% per year
40 Flex II: 10.3% per year
* 80 Fidelity is a portfolio of very popular and widely-available index funds from Fidelity Investments allocated in a 80% stocks, 20% bonds strategy similar to that of the 80 Flex portfolios, and I want to compare the two; the 80 Fidelity portfolio uses a style-pure, buy-hold-rebalance method, while the 80 Flex portfolio allows for a great deal of tactical adjustments within the 80% stock long-term strategy.
** Not all Flex III funds were available for the full 10-year period, but all Flex II funds were.
An important aspect of my Flex portfolios is their ability to tactically shift allocation within the long-term strategy; why stay put if you are pretty sure it's going to be rough and you have a better idea at the moment? Right now, the Stock-Bond-Alternatives-Cash allocation percentages are approximately:
80 Flex III: 48-9-17-26
60 Flex III: 36-17-14-33
40 Flex III: 24-24-12-40
For long-term investors, staying the course with a global/flexible portfolio is probably a lot better than trying to time the market. Please contact me with your questions or thoughts. Thank you!
--Gary
(FYI, my own retirement portfolio is mostly in 80 Flex III—I have a pretty strong risk tolerance and plan to be working and saving for the next 25 years.)
Garo Linck Partoyan
Financial Advisor
Potomac Wealth Strategies, LLC
(703) 746-8195
Garo.Partoyan@PotomacWealthStrategies.com
www.PotomacWealthStrategies.com
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