| US and Foreign Indexes | 3 mo | 1 yr | 2 yr | 3 yr | 5 yr | 10 yr | 2008 | |
| Stock Markets (72-21-7) | 4.4% | 14.5% | 7.0% | 6.2% | 10.4% | 3.7% | -41.0% | |
| S&P 500 | 3.6% | 13.7% | 8.4% | 8.6% | 12.4% | 5.4% | -38.5% | |
| Dow Jones Industrial Avg | 4.5% | 18.8% | 11.2% | 9.7% | 11.0% | 5.2% | -33.8% | |
| MSCI EAFE | 5.6% | 14.7% | 1.5% | 0.1% | 6.1% | -1.4% | -45.1% | |
| MSCI EM | 9.0% | 22.1% | 8.7% | 0.0% | 2.3% | -0.4% | -54.5% | |
| Barclays Agg Bond--US | 1.1% | -0.5% | 2.7% | 2.7% | 2.0% | 4.4% | 5.2% | |
| Citi WGBI nonUSD (foreign bonds) | 5.0% | -3.0% | 5.3% | -0.9% | -0.5% | 3.2% | 10.1% | |
| Aggressive (90% stocks-10% bonds) | 3.3% | 10.8% | 5.6% | 4.5% | 8.2% | 3.8% | -36.0% | |
| 95 Strategic III | 3.4% | 12.0% | 8.9% | 7.7% | 11.3% | 8.1% | -30.9% | |
| 95 Schwab index 2017 | 3.9% | 15.3% | 7.9% | 7.8% | 12.0% | 6.2% | -34.3% | |
| 95 Strategic USA II | 2.8% | 14.0% | 9.7% | 9.2% | 13.5% | 10.1% | -25.8% | |
| Confluence Value Opportunities | -22.3% | |||||||
| Confluence Equity Income | -18.9% | |||||||
| WealthFront 9 | 4.9% | 15.2% | 7.8% | 5.5% | 9.3% | 4.5% | -38.1% | |
| American Funds Port Ser Growth | 5.6% | 18.0% | 8.7% | 8.8% | 13.3% | 6.5% | -40.8% | |
| American Funds Port Ser Global Growth | 6.7% | 19.1% | 8.4% | 7.4% | 11.9% | 6.0% | -40.5% | |
| Moderately Aggressive (75-25) | 2.8% | 9.1% | 5.1% | 4.0% | 7.1% | 3.9% | -31.0% | |
| 80 Flex IV | 2.7% | 8.6% | 6.0% | 3.3% | 6.5% | |||
| 80 Flex V | 3.0% | 8.3% | 5.1% | 3.8% | 7.8% | -16.9% | ||
| 80 Strategic II | 3.9% | 15.7% | 7.9% | 6.6% | 10.7% | 7.5% | -31.1% | |
| 80 Strategic III | 3.1% | 10.8% | 8.2% | 7.1% | 10.3% | 7.8% | -27.7% | |
| 80 USA tilt | 3.4% | 14.1% | 7.5% | 6.5% | 10.4% | 7.1% | -28.5% | |
| 80 Schwab index 2017 | 3.4% | 12.6% | 6.8% | 6.7% | 10.1% | 5.7% | -29.3% | |
| Money 75 | 3.7% | 13.7% | 7.8% | 6.6% | 10.3% | 6.3% | -32.7% | |
| American Funds Port Ser Gr+Inc | 4.5% | 12.1% | 7.8% | 6.8% | 10.3% | 5.7% | -30.8% | |
| Moderate (60-40) | 2.3% | 7.3% | 4.5% | 3.6% | 5.9% | 4.0% | 25.6% | |
| 60 Strategic III | 2.5% | 8.6% | 6.9% | 5.9% | 8.5% | 7.2% | -23.3% | |
| 60 Schwab index 2017 | 2.8% | 10.1% | 5.7% | 5.5% | 8.3% | 5.1% | -23.8% | |
| American Funds Port Ser Balanced | 4.2% | 10.7% | 7.1% | 6.5% | 9.2% | 5.7% | -28.4% | |
| Moderately Conservative (40-60) | 1.8% | 5.5% | 3.7% | 2.8% | 4.4% | 3.8% | -17.4% | |
| 40 Strategic III | 1.8% | 6.9% | 5.6% | 4.7% | 6.6% | 6.7% | -16.8% | |
| 40 Schwab Index 2017 | 2.1% | 6.8% | 4.0% | 3.9% | 5.7% | 4.2% | -16.2% | |
| Hartford Balanced Income A | 2.7% | 7.4% | 8.1% | 6.3% | 7.9% | 7.1% | -18.5% | |
| Goldman Sachs Income Builder | 2.7% | 8.6% | 4.7% | 3.6% | 7.3% | 5.7% | -23.3% | |
| Conservative (20-80) | 1.3% | 2.9% | 2.8% | 1.8% | 2.5% | 3.5% | -8.4% | |
| 20 Strategic III | 1.1% | 3.5% | 4.2% | 3.0% | 3.7% | 4.6% | -9.3% | |
| 20 Schwab index 2017 | 1.5% | 3.8% | 2.8% | 2.7% | 3.7% | 3.4% | -9.2% | |
| NOTE 1: Past performance is no guarantee of specific future results. This data is presented by Potomac Wealth Strategies, LLC. This data is from Morningstar and should be accurate, but it has not been independently verified. | ||||||||
| NOTE 2: "Flex", "Strategic", and "Index" models are crafted/run by Potomac Wealth Strategies. They show history of better returns, lower volatility, or both--or, with the Index models, closer tracking--vs benchmarks and competitors. | ||||||||
| NOTE 3: "XX Schwab index" models are relatively low-cost and tax-efficient portfolios. They are comprised of index funds available free of transaction charges to my clients at Schwab. This is what many might recommend due to low-costs and portfolio efficiency. | ||||||||
| NOTE 4: Nothing on this blog post is specific investment advice to any individual or organization. If the information hereon is of interest to you, please send e-mail to Info@PotomacWealthStrategies.com for a consultation. | ||||||||
An investing and financial strategies blog offered by Gary Partoyan, veteran financial advisor and owner of Potomac Wealth Strategies, LLC.
Thursday, August 31, 2017
PWS Model Portfolio Performance through July 2017
Tuesday, July 18, 2017
PWS Model Portfolio Performance through June 2017
My portfolio models continue to outperform their blended benchmarks. You hear a lot in the financial press about "cost" but not enough about "cost-justification". Most mutual funds don't outperform their benchmarks or their low-cost index fund competitors, but many do and I know how to find them and put them to use.
| US and Foreign Indexes | 3 mo | 1 yr | 2 yr | 3 yr | 5 yr | 10 yr | 2008 | |
| Stock Markets (72-21-7) | 3.3% | 16.3% | 6.5% | 4.9% | 10.1% | 3.2% | -41.0% | |
| S&P 500 | 2.6% | 15.5% | 8.4% | 7.3% | 12.2% | 4.9% | -38.5% | |
| Dow Jones Industrial Avg | 3.3% | 19.1% | 10.1% | 8.3% | 10.6% | 4.8% | -33.8% | |
| MSCI EAFE | 5.0% | 17.1% | 1.1% | -1.5% | 5.8% | -1.8% | -45.1% | |
| MSCI EM | 5.5% | 21.2% | 2.0% | -1.3% | 1.5% | -0.5% | -54.5% | |
| Barclays Agg Bond--US | 1.5% | -0.3% | 2.8% | 2.5% | 2.2% | 4.5% | 5.2% | |
| Citi WGBI nonUSD (foreign bonds) | 3.8% | -5.0% | 4.0% | -2.2% | -0.8% | 3.2% | 10.1% | |
| Aggressive (90% stocks-10% bonds) | 2.2% | 12.0% | 4.8% | 3.1% | 8.1% | 3.4% | -36.0% | |
| 95 Strategic III | 2.6% | 12.9% | 8.4% | 6.2% | 11.1% | 7.6% | -30.9% | |
| 95 Schwab index 2017 | 3.5% | 17.7% | 7.6% | 6.3% | 11.8% | 5.7% | -34.3% | |
| 95 Strategic USA II | 1.7% | 15.4% | 9.4% | 7.6% | 13.3% | 9.5% | -25.8% | |
| Confluence Value Opportunities | 1.6% | 23.4% | 14.1% | 20.0% | 11.8% | -22.3% | ||
| Confluence Equity Income | 2.7% | 12.7% | 9.8% | 14.0% | 9.3% | -18.9% | ||
| WealthFront 9 | 3.6% | 15.9% | 6.1% | 4.0% | 8.9% | 4.2% | -38.1% | |
| American Funds Port Ser Growth | 4.6% | 19.4% | 7.6% | 6.9% | 12.9% | 6.0% | -40.8% | |
| American Funds Port Ser Global Growth | 6.0% | 20.9% | 7.3% | 5.6% | 11.5% | 5.5% | -40.5% | |
| Moderately Aggressive (75-25) | 1.9% | 10.1% | 4.4% | 2.8% | 7.0% | 3.5% | -31.0% | |
| 80 Flex IV | 1.4% | 9.0% | 4.7% | 2.2% | 6.3% | |||
| 80 Flex V | 1.7% | 8.6% | 4.1% | 2.6% | 7.5% | -16.9% | ||
| 80 Strategic II | 3.1% | 17.3% | 6.7% | 5.0% | 10.4% | 6.9% | -31.1% | |
| 80 Strategic III | 2.4% | 11.6% | 7.7% | 5.7% | 10.1% | 7.4% | -27.7% | |
| 80 USA tilt | 2.5% | 15.6% | 6.5% | 5.0% | 10.1% | 6.6% | -28.5% | |
| 80 Schwab index 2017 | 3.0% | 14.4% | 6.5% | 5.4% | 9.9% | 5.3% | -29.3% | |
| Money 75 | 2.8% | 15.4% | 7.0% | 5.3% | 10.0% | 5.9% | -32.7% | |
| American Funds Port Ser Gr+Inc | 3.5% | 12.8% | 7.5% | 5.5% | 10.2% | 5.3% | -30.8% | |
| Moderate (60-40) | 1.6% | 8.1% | 4.0% | 2.6% | 5.9% | 3.7% | 25.6% | |
| 60 Strategic III | 2.0% | 9.4% | 6.5% | 4.8% | 8.4% | 6.8% | -23.3% | |
| 60 Schwab index 2017 | 2.5% | 11.5% | 5.5% | 4.6% | 8.1% | 4.8% | -23.8% | |
| American Funds Port Ser Balanced | 3.5% | 11.1% | 6.8% | 5.2% | 9.1% | 5.3% | -28.4% | |
| Moderately Conservative (40-60) | 1.4% | 5.9% | 3.3% | 2.0% | 4.4% | 3.6% | -17.4% | |
| 40 Strategic III | 1.5% | 7.4% | 5.4% | 3.8% | 6.7% | 6.4% | -16.8% | |
| 40 Schwab Index 2017 | 2.0% | 7.8% | 3.8% | 3.1% | 5.6% | 4.0% | -16.2% | |
| Hartford Balanced Income A | 2.3% | 8.1% | 8.0% | 5.5% | 8.3% | 6.8% | -18.5% | |
| Goldman Sachs Income Builder | 1.9% | 9.8% | 4.4% | 2.6% | 7.3% | 5.4% | -23.3% | |
| Conservative (20-80) | 0.9% | 2.8% | 2.4% | 1.2% | 2.5% | 3.4% | -8.4% | |
| 20 Strategic III | 0.9% | 3.7% | 4.0% | 2.6% | 3.8% | 4.6% | -9.3% | |
| 20 Schwab index 2017 | 1.3% | 4.1% | 2.7% | 2.3% | 3.7% | 3.3% | -9.2% | |
| NOTE 1: Past performance is no guarantee of specific future results. This data is presented by Potomac Wealth Strategies, LLC. This data is from Morningstar and should be accurate, but it has not been independently verified. | ||||||||
| NOTE 2: "Flex", "Strategic", and "Index" models are crafted/run by Potomac Wealth Strategies. They show history of better returns, lower volatility, or both--or, with the Index models, closer tracking--vs benchmarks and competitors. | ||||||||
| NOTE 3: "XX Schwab index" models are relatively low-cost and tax-efficient portfolios. They are comprised of index funds available free of transaction charges to my clients at Schwab. This is what many might recommend due to low-costs and portfolio efficiency. | ||||||||
| NOTE 4: Nothing on this blog post is specific investment advice to any individual or organization. If the information hereon is of interest to you, please send e-mail to Info@PotomacWealthStrategies.com for a consultation. | ||||||||
Monday, April 24, 2017
Portfolio Model Performance Through March 2017
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Wednesday, March 22, 2017
What is Asset Allocation?
"Asset Allocation" is the embodiment of and guidance offered
by some Nobel Prize-winning portfolio construction/management research:
·
Asset Allocation is how we most prudently aim for either the best gains
at a set level of risk or the least amount of risk for a targeted level of
gains.
o
Aggressive investors are about 95% stocks and 5% bonds/cash
o
Moderately Aggressive = 80/20
o
Moderate = 60/40
o
Moderately Conservative = 40/60
o
Conservative = 20/80
o
Most working folks our age and time-horizon are Moderate to Aggressive;
most retirees are Conservative.
·
Asset Allocation spreads out our investments across the strategic asset
classes and sub-classes thereof:
o
Stocks (large, medium, or small companies... growing companies or
well-established money-makers... USA,
developed-market foreign, developing markets...)
o
Bonds (corporate, government, domestic or foreign,
high-quality/low-interest or low-quality/high-interest, and so forth)
o
Commodities
o
Cash
o
How much into each determines portfolio.
Generally, high volatility is riskier and low volatility is safer, and
more risk is correlated with better returns while less risk usually means lower
returns. A typical retiree needs to be
safer, and professional with 20+ years to retirement can probably afford to
take more risk.
·
How to implement Asset Allocation
o
For my clients, I use mutual fund portfolios of my own design, allocated
according to the strategic asset allocation guidance of trusted sources
(usually it's Ibbotson's work that's now owned by Morningstar). Specifically, I offer clients my Strategic,
Schwab Index, and Flex portfolio models.
Each has a different take on how to implement Asset Allocation. Strategic III models are my preferred
portfolios now.
§ Over time,
we'll shift from Aggressive on down to Conservative--the closer you get to
retirement, the more conservative.
Usually about every 5-10 years we'll downshift by re-allocating the
portfolio.
§ I use
best-of-breed mutual funds to populate each part of the Asset Allocation of
each model.
o
"Target Date" funds do it all for you ongoing. You could put everything into a target date
fund and leave it there forever, and employer-sponsored retirement plans often
offer such and even put you into them automatically.
§ You're in a
"The 2045 fund can be used forever by anyone expecting to retire around
Year 2045.
§ But they
usually use only their own in-house products.
Your Nationwide Destination 2045 fund at work uses only Nationwide
products. The results have been very
good lately, but not as good over the long-term.
o
"Allocation Funds" are like Target Date funds in they are
total portfolios in one fund, but they don't change over time--an Aggressive
allocation fund remain so, so you'd exit that one and move into a Moderate or
Conservative fund as you get closer to the retirement year.
Garo Linck Partoyan
Potomac Wealth Strategies, LLC
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