ETF Alpha Plan
This plan uses two ETF strategies.
The first strategy called "3x Lever" uses 3x leveraged ETFs representing different aspects of the market, such as sector, country, commodity or asset class. Under market downturns, the strategy goes into a bond ETF, which may or may not be leveraged
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The second strategy called "Best of Sectors" uses normal ETFs across major sectors, styles and factors
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At any point in time, you will get recommendation for the best ETF for each strategy to be held for the period until our underlying models suggest a change in the ETF(s). When a change is needed, you will get a recommendation for selling the current ETF(s) and buying a new one that we recommend.
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Average number of trades / year: 12 to 14
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Is our money invested in these strategies: YES
Past Performance
17% 3x Lever and 83% Best of Sectors
Returns
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16 years: 51.7% p.a.
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10 years: 51.8% p.a.
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3 years: 51% p.a.
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3 months: 18.9% increase
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1 month: 4% increase
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Risk
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Probability of 15% y-o-y loss: 0.08% vs 17.2% for S&P500
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Sortino Ratio: 16.2 vs 2.03 for S&P500
How to use?
You can use this strategy in any account where you can buy regular and leveraged ETFs.
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If your account does not offer the ETFs , then use the ETF that is closest to our recommendation.
Considering that the 3X Lever strategy can inherently be 3x the normal short term volatility, we recommend that you do not overweight your investments in that strategy. For the amount that you want to invest in the Alpha plan, use 15%/85% mix for the 3x Lever and Best of Sectors strategies. This would be close to the mix that we have for our portfolio