| US and Foreign Indexes | 1 mo | 3 mo | YTD | 1 yr | 2 yr | 3 yr | 5 yr | 10 yr |
| Stock Markets (50-40-10) | 2.0% | 7.1% | 7.1% | 11.6% | 6.1% | 8.5% | 2.7% | 9.8% |
| S&P 500 | 3.8% | 10.6% | 10.6% | 14.0% | 11.2% | 12.7% | 5.8% | 8.5% |
| MSCI EAFE | 0.8% | 5.1% | 5.1% | 11.3% | 2.4% | 5.0% | -0.9% | 9.7% |
| Barclays Agg Bond--US | 0.1% | -0.1% | -0.1% | 3.8% | 5.7% | 5.5% | 5.5% | 5.0% |
| Barclays Agg Bond--Global | -0.3% | -2.1% | -2.1% | 1.3% | 3.2% | 4.5% | 3.7% | 5.5% |
| Moderately Aggressive | 1.8% | 6.0% | 6.0% | 10.7% | 6.6% | 8.3% | 3.2% | 8.6% |
| 80 Flex IV | 1.3% | 3.9% | 3.9% | 8.4% | 6.2% | 8.7% | 7.8% | 10.9% |
| 80 Flex III | 1.3% | 4.0% | 4.0% | 9.0% | 5.6% | 8.4% | ||
| 80 Fidelity | 2.1% | 6.1% | 6.1% | 11.0% | 6.4% | 8.3% | 3.5% | 8.7% |
| Moderate | 1.3% | 4.2% | 4.2% | 8.6% | 6.2% | 7.7% | 3.7% | 7.9% |
| 60 Flex IV | 1.1% | 3.7% | 3.7% | 9.7% | 7.0% | 9.1% | 8.2% | 11.2% |
| 60 Flex III | 1.1% | 3.4% | 3.4% | 9.7% | 6.4% | 8.7% | ||
| 60 Vanguard | 1.6% | 4.6% | 4.6% | 10.1% | 7.5% | 8.7% | 4.6% | 8.1% |
| Moderately Conservative | 0.9% | 2.4% | 2.4% | 6.5% | 5.8% | 6.9% | 4.0% | 5.4% |
| 40 Flex IV | 0.8% | 2.9% | 2.9% | 10.2% | 7.3% | 9.0% | 8.5% | 10.4% |
| 40 Vanguard | 1.2% | 3.1% | 3.1% | 8.5% | 7.5% | 8.1% | 5.2% | 7.3% |
| Asset Allocation | Cash | Stock | Bond | Other | ||||
| 80 Flex IV | 24% | 45% | 21% | 10% | ||||
| 60 Flex IV | 21% | 39% | 31% | 9% | ||||
| 40 Flex IV | 23% | 26% | 44% | 7% |
An investing and financial strategies blog offered by Gary Partoyan, veteran financial advisor and owner of Potomac Wealth Strategies, LLC.
Thursday, April 18, 2013
Flex Portfolio Performance Through March 2013
Here are the (unaudited by anyone but me; data comes from Morningstar) performance #s for selected Flex portfolios through March of 2013.
Thursday, March 14, 2013
Flex Portfolio Performance Through February 2013
Here are the performance data for the most widely-used Flex portfolios and their strategic counterparts comprised of Vanguard or Fidelity index funds.
As the stock markets in the USA set or rapidly approach all-time highs despite mixed macroeconomic data globally and confounding politics domestically, I believe the Flex portfolios remain the most effective way to be fully-invested but ready to weather storms that may be brewing.
As the stock markets in the USA set or rapidly approach all-time highs despite mixed macroeconomic data globally and confounding politics domestically, I believe the Flex portfolios remain the most effective way to be fully-invested but ready to weather storms that may be brewing.
| US and Foreign Indexes | 1 mo | 3 mo | YTD | 1 yr | 2 yr | 3 yr | 5 yr | 10 yr |
| Stock Markets (50-40-10) | 0.2% | 7.3% | 5.0% | 10.6% | 4.8% | 10.0% | 2.1% | 9.6% |
| S&P 500 | 1.4% | 7.6% | 6.6% | 13.3% | 9.1% | 13.4% | 4.9% | 8.1% |
| MSCI EAFE | -1.0% | 7.6% | 4.2% | 9.8% | 0.8% | 6.7% | -1.3% | 9.2% |
| Barclays Agg Bond--US | 0.5% | -0.3% | -0.2% | 3.1% | 5.7% | 5.5% | 5.5% | 5.0% |
| Barclays Agg Bond--Global | -1.0% | -2.2% | -1.9% | 0.8% | 3.6% | 4.4% | 4.1% | 5.5% |
| Moderately Aggressive | 0.1% | 5.8% | 4.1% | 9.8% | 5.2% | 9.4% | 2.7% | 8.4% |
| 80 Flex IV | -0.1% | 4.0% | 2.6% | 7.1% | 5.9% | 9.4% | 7.4% | 10.7% |
| 80 Flex III | -0.2% | 4.3% | 2.6% | 8.0% | 5.4% | 9.2% | ||
| 80 Fidelity | 0.1% | 6.1% | 3.9% | 10.0% | 4.9% | 9.4% | 3.0% | 8.5% |
| Moderate | 0.0% | 3.9% | 2.8% | 7.7% | 5.2% | 8.4% | 3.4% | 7.7% |
| 60 Flex IV | 0.0% | 4.0% | 2.5% | 8.5% | 6.7% | 9.8% | 7.8% | 10.9% |
| 60 Flex III | 0.0% | 3.8% | 2.3% | 8.8% | 6.3% | 9.5% | ||
| 60 Vanguard | 0.3% | 4.2% | 2.9% | 9.1% | 6.2% | 9.4% | 4.2% | 7.9% |
| Moderately Conservative | 0.0% | 2.1% | 1.5% | 5.7% | 5.2% | 7.3% | 3.9% | 6.9% |
| 40 Flex IV | 0.2% | 3.4% | 2.1% | 9.4% | 7.3% | 9.7% | 8.2% | 10.2% |
| 40 Vanguard | 0.5% | 2.7% | 1.9% | 7.5% | 6.5% | 8.5% | 4.9% | 7.1% |
| Asset Allocation | Cash | Stock | Bond | Other | ||||
| 80 Flex IV | 24% | 46% | 21% | 9% | ||||
| 60 Flex IV | 21% | 40% | 30% | 9% | ||||
| 40 Flex IV | 23% | 26% | 44% | 7% |
Tuesday, February 5, 2013
Flex Portfolio Performance Through January 2013
Global stock markets have been rising strongly. This is despite global-macro economic and geopolitical concerns--very slow growth in USA, continued economic troubles in Europe, China slowing, Japan still in a rut, flare-ups exacerbating problems and potential for more in the middle east. I sense that the U.S. Federal Reserve's pretty much open-ended commitment to buying Treasury debt (funding deficit spending in effort to keep the economy afloat while it tries to learn how to swim again) is creating an artificial wave that stock investors are willing to surf. For now.
This is why I favor a global/flexible portfolio management approach. My "Flex" portfolios are the best way I know to implement such.
Yes, diversified portfolios have struggled to keep pace with the stock markets, but that is understandable because such are invested at most around 80% in stocks, and perhaps as little as 20%.
What is more important to compare is portfolio performance against the correct blended benchmark. A moderate-risk investor should be about 60-40 stocks-bonds, for example, and thus would compare to a benchmark of 60% stock indexes and 40% bond indexes--not merely the Dow Jones Industrial Average or the S&P 500 index.
This is where the Flex portfolios are doing their jobs well. They are outperforming their benchmarks, as you can see in the data below, and doing so with much less volatility (a measure of risk).
While I do not ignore short-term performance comparisons, I believe it is most relevant and prudent to consider 3-, 5-, and 10-year time periods when comparing portfolios to each other and/or to their benchmarks.
This is why I favor a global/flexible portfolio management approach. My "Flex" portfolios are the best way I know to implement such.
Yes, diversified portfolios have struggled to keep pace with the stock markets, but that is understandable because such are invested at most around 80% in stocks, and perhaps as little as 20%.
What is more important to compare is portfolio performance against the correct blended benchmark. A moderate-risk investor should be about 60-40 stocks-bonds, for example, and thus would compare to a benchmark of 60% stock indexes and 40% bond indexes--not merely the Dow Jones Industrial Average or the S&P 500 index.
This is where the Flex portfolios are doing their jobs well. They are outperforming their benchmarks, as you can see in the data below, and doing so with much less volatility (a measure of risk).
While I do not ignore short-term performance comparisons, I believe it is most relevant and prudent to consider 3-, 5-, and 10-year time periods when comparing portfolios to each other and/or to their benchmarks.
| US and Foreign Indexes | 1 mo | 3 mo | YTD | 1 yr | 2 yr | 3 yr | 5 yr | 10 yr |
| Stock Markets (50-40-10) | 4.8% | 8.6% | 4.8% | 15.7% | 6.0% | 10.2% | 1.6% | 9.1% |
| S&P 500 | 5.2% | 6.8% | 5.2% | 16.8% | 10.3% | 14.1% | 4.0% | 7.9% |
| MSCI EAFE | 5.3% | 11.3% | 5.3% | 17.3% | 3.0% | 6.9% | -0.8% | 9.2% |
| Barclays Agg Bond--US | -0.7% | -0.7% | -0.7% | 2.6% | 5.6% | 5.4% | 5.5% | 5.1% |
| Barclays Agg Bond--Global | -0.9% | -1.3% | -0.9% | 1.7% | 4.4% | 4.7% | 4.7% | 5.8% |
| Moderately Aggressive | 4.0% | 5.6% | 4.0% | 13.4% | 6.0% | 9.0% | 1.8% | 7.6% |
| 80 Flex IV | 2.6% | 4.9% | 2.6% | 9.3% | 6.9% | 9.5% | 7.0% | 10.1% |
| 80 Flex III | 2.8% | 5.4% | 2.8% | 10.3% | 6.6% | 9.2% | ||
| 80 Fidelity | 3.8% | 7.2% | 3.8% | 13.6% | 5.8% | 9.2% | 1.9% | 7.7% |
| Moderate | 2.7% | 4.8% | 2.7% | 10.1% | 5.5% | 7.8% | 2.3% | 6.9% |
| 60 Flex IV | 2.5% | 5.0% | 2.5% | 10.7% | 7.4% | 9.6% | 7.3% | 10.2% |
| 60 Flex III | 2.2% | 4.6% | 2.2% | 10.7% | 7.1% | 9.4% | ||
| 60 Vanguard | 2.5% | 4.9% | 2.5% | 11.0% | 6.4% | 8.7% | 2.8% | 7.0% |
| Moderately Conservative | 1.5% | 2.8% | 1.5% | 6.9% | 5.2% | 6.7% | 2.9% | 6.2% |
| 40 Flex IV | 1.8% | 4.2% | 1.8% | 11.0% | 7.7% | 9.6% | 7.7% | 9.7% |
| 40 Vanguard | 1.4% | 3.0% | 1.4% | 8.3% | 6.3% | 7.7% | 3.6% | 6.3% |
| Asset Allocation | Cash | Stock | Bond | Other | ||||
| 80 Flex IV | 24% | 45% | 21% | 10% | ||||
| 60 Flex IV | 21% | 40% | 30% | 9% | ||||
| 40 Flex IV | 23% | 26% | 43% | 8% |
Saturday, February 2, 2013
Flex Portfolio Funds: Recent Commentaries
Here are links to commentaries offered by several mutual funds used in the Flex Portfolios.
PIMCO Total Return Fund
PIMCO All Asset Fund
PIMCO Income Fund
Yacktman Focused Fund
First Eagle Overseas Fund
Ivy Asset Strategy Fund
Permanent Portfolio Fund
Arrow DWA Tactical Fund
First Eagle Global Fund
Templeton Global Bond Fund
Please contact me with any questions about these mutual funds. Thank you.
--Gary Partoyan
PIMCO Total Return Fund
PIMCO All Asset Fund
PIMCO Income Fund
Yacktman Focused Fund
First Eagle Overseas Fund
Ivy Asset Strategy Fund
Permanent Portfolio Fund
Arrow DWA Tactical Fund
First Eagle Global Fund
Templeton Global Bond Fund
Please contact me with any questions about these mutual funds. Thank you.
--Gary Partoyan
Monday, January 14, 2013
Flex Portfolio Performance Through December 2012
2012 was a strong year for the Flex portfolios! Double-digit returns, on the heels of or surpassing the benchmarks, and lower volatility than standard portfolios.
In 2012, surging bond prices helped the Moderate to Conservative Flex portfolios outperform their benchmarks significantly in the 4th quarter and for the entire year.
The 10-, 5-, 3-, and 2-year performance has been benchmark-beating for ALL of the Flex portfolios.
Thank you for your business, time, and interest. Happy New Year!
In 2012, surging bond prices helped the Moderate to Conservative Flex portfolios outperform their benchmarks significantly in the 4th quarter and for the entire year.
The 10-, 5-, 3-, and 2-year performance has been benchmark-beating for ALL of the Flex portfolios.
Thank you for your business, time, and interest. Happy New Year!
| US and Foreign Indexes | 1 mo | 3 mo | YTD | 1 yr | 2 yr | 3 yr | 5 yr | 10 yr |
| Stock Markets (50-40-10) | 2.0% | 2.9% | 16.4% | 16.4% | 4.5% | 6.9% | -1.0% | 8.2% |
| S&P 500 | 0.9% | 0.4% | 16.0% | 16.0% | 8.8% | 10.9% | 1.7% | 7.1% |
| MSCI EAFE | 3.2% | 6.6% | 17.3% | 17.3% | 1.5% | 3.6% | -3.7% | 8.2% |
| Barclays Agg Bond--US | -0.1% | 0.2% | 4.2% | 4.2% | 6.0% | 6.2% | 6.0% | 5.2% |
| Barclays Agg Bond--Global | -0.3% | -0.5% | 4.3% | 4.3% | 5.0% | 5.2% | 5.4% | 6.0% |
| Moderately Aggressive | 1.6% | 2.4% | 13.6% | 13.6% | 4.9% | 6.5% | -0.2% | 6.9% |
| 80 Flex IV | 1.4% | 1.7% | 11.4% | 11.4% | 5.6% | 8.2% | 6.3% | 9.9% |
| 80 Flex III | 1.6% | 2.0% | 11.9% | 11.9% | 5.0% | 7.7% | ||
| 80 Fidelity | 2.0% | 3.0% | 14.2% | 14.2% | 4.8% | 6.6% | 0.0% | 7.0% |
| Moderate | 1.1% | 1.7% | 10.7% | 10.7% | 4.9% | 6.1% | 1.0% | 6.4% |
| 60 Flex IV | 1.4% | 2.1% | 12.8% | 12.8% | 6.2% | 8.6% | 6.7% | 10.0% |
| 60 Flex III | 1.5% | 2.1% | 12.6% | 12.6% | 5.9% | 8.3% | 6.1% | 9.1% |
| 60 Fidelity | 1.5% | 2.3% | 11.1% | 11.1% | 4.5% | 5.9% | 0.8% | 6.1% |
| Moderately Conservative | 0.6% | 1.0% | 8.1% | 8.1% | 5.0% | 5.8% | 2.3% | 5.9% |
| 40 Flex IV | 1.3% | 2.3% | 13.4% | 13.4% | 6.9% | 8.9% | 7.5% | 9.6% |
| 40 Fidelity | 0.9% | 1.5% | 8.5% | 8.5% | 4.7% | 5.6% | 2.1% | 5.5% |
| Asset Allocation | Cash | Stock | Bond | Other | ||||
| 80 Flex IV | 25% | 45% | 21% | 9% | ||||
| 60 Flex IV | 22% | 39% | 30% | 9% | ||||
| 40 Flex IV | 24% | 26% | 43% | 7% |
Friday, December 14, 2012
Year-End Mutual Fund Distributions--Fear Not the Price Drop!
Good morning. Most of
my clients are in some mutual funds that
appear to have dropped in value suddenly, but fear not. The share prices have been reduced in
exchange for cash (or more shares in the case of the cash being reinvested). The value of our investments did not drop
from this--it's all just fine.
This is a normal activity for many mutual funds at this time
of year. The cash is a distribution of "long-term
capital gains", "short-term capital gains", and/or
"dividends"--not the usual monthly or quarterly kind, but special
annual distributions. Such are made per
regulations that require mutual funds to make some distributions directly to
clients instead of incorporating them into the Net Asset Value (share price) of
the mutual fund. Yes, it is a little
tricky to explain, but I am happy to provide more detail if you want. But it is normal, expected, and does not
represent an unusual reduction in value of our investments.
Example: In one account I reveiwed, the First Eagle
Overseas Fund dropped NAV from 22.83 at market close on 12/12 to 21.66 at close
on 12/13. That's a 5.1% drop in share
price, BUT the value of the fund's investments did not drop by 5.1%. How?
Well, on 12/12 the account received three chunks of cash (long-term cap
gains, short-term cap gains, and some dividends) totalling $747, and that was
reinvested into 32.7 shares at $22.83 (closing price on 12/12). So, prior to the special distribution, there
was $14,616 in that position and after the distribution/reinvestment it was $14,576… the $40 decline (about 0.2% of the value) is
attributable to the slight market decline that particular day.
Please contact me with any questions, of course. Thank you, and make it a great Friday!
--Gary
NOTE: I offer a
special "Thank You" to a certain client for reminding me that this
should be explained to everyone!
Tuesday, December 11, 2012
Flex Portfolio Performance Through November 2012
With the creation of the new Flex IV portfolios, most clients will be moved out of Flex II and Flex III portfolios. The Flex portfolios are designed to provide nimble tactical management even while my clients and I aim to keep the strategic allocation in place during various market conditions.
Strategic: diversified portfolios consistent with Nobel Prize-winning methodology to optimize the balance between risk and reward; best to maintain the portfolio in targeted strategy, so we remain invested fully in the mutual funds comprising the Flex portfolios.
Tactical: what, if anything, should be done within the portfolios under various market conditions; we leave this up to the managers of each fund in the Flex portfolios.
The Flex portfolios continue to demonstrate excellent risk-management while participating very well in the markets in the near-term; they show significant out-performance in the intermediate- and long-term periods.
Below are the through-November performance numbers for the key Flex portfolios and their index fund-comprised low-cost alternatives:
Strategic: diversified portfolios consistent with Nobel Prize-winning methodology to optimize the balance between risk and reward; best to maintain the portfolio in targeted strategy, so we remain invested fully in the mutual funds comprising the Flex portfolios.
Tactical: what, if anything, should be done within the portfolios under various market conditions; we leave this up to the managers of each fund in the Flex portfolios.
The Flex portfolios continue to demonstrate excellent risk-management while participating very well in the markets in the near-term; they show significant out-performance in the intermediate- and long-term periods.
Below are the through-November performance numbers for the key Flex portfolios and their index fund-comprised low-cost alternatives:
| US and Foreign Indexes | 1 mo | 3 mo | YTD | 1 yr | 2 yr | 3 yr | 5 yr | 10 yr |
| Stock Markets (50-40-10) | 1.4% | 3.7% | 13.9% | 13.9% | 7.0% | 6.8% | -1.7% | 7.4% |
| S&P 500 | 0.6% | 1.3% | 15.0% | 16.1% | 11.9% | 11.3% | 1.3% | 6.4% |
| MSCI EAFE | 2.4% | 6.3% | 13.6% | 12.5% | 3.8% | 2.9% | -4.8% | 7.4% |
| Barclays Agg Bond--US | 0.2% | 0.5% | 4.4% | 5.5% | 5.5% | 5.7% | 6.0% | 5.4% |
| Barclays Agg Bond--Global | 0.0% | 1.1% | 4.7% | 5.4% | 5.8% | 4.0% | 5.5% | 6.4% |
| Moderately Aggressive | 1.2% | 3.1% | 11.8% | 12.1% | 7.1% | 6.2% | -0.7% | 6.4% |
| 80 Flex IV | 0.9% | 2.6% | 9.9% | 8.7% | 6.6% | 7.9% | 6.1% | 10.0% |
| 80 Flex III | 1.0% | 2.0% | 9.2% | 7.7% | 5.3% | 6.6% | ||
| 80 Fidelity | 1.3% | 3.2% | 11.9% | 11.5% | 6.7% | 6.4% | -0.7% | 6.4% |
| Moderate | 1.0% | 2.5% | 9.6% | 10.0% | 6.5% | 5.6% | 0.6% | 6.1% |
| 60 Flex IV | 1.0% | 3.1% | 11.3% | 10.2% | 6.9% | 8.2% | 6.6% | 10.1% |
| 60 Flex III | 1.0% | 2.3% | 9.7% | 8.8% | 5.5% | 6.7% | ||
| 60 Fidelity | 1.0% | 2.4% | 9.5% | 9.5% | 5.8% | 5.7% | 0.3% | 5.8% |
| Moderately Conservative | 0.8% | 1.8% | 7.4% | 8.0% | 6.1% | 5.1% | 2.0% | 5.9% |
| 40 Flex IV | 1.0% | 3.3% | 12.0% | 11.6% | 7.3% | 8.6% | 7.4% | 9.7% |
| 40 Fidelity | 0.7% | 1.7% | 7.5% | 7.8% | 5.4% | 5.3% | 1.8% | 5.3% |
| Asset Allocation | Cash | Stock | Bond | Other | ||||
| 80 Flex IV | 25% | 44% | 21% | 10% | ||||
| 60 Flex IV | 22% | 39% | 30% | 9% | ||||
| 40 Flex IV | 24% | 26% | 43% | 7% |
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