Cracking the Code of Successful Investing: Most people know that the highest investment returns historically come from the stock market, with the S&P 500 index averaging an annual return of 6.14% since its creation in 1925. However, that higher performance comes with its share of risk, because the stock market regularly loses half its value when bear markets take their toll.
In the last 18 years, equities have lost half their value not once – but twice – and with current valuations incredibly high, stocks may be on the precipice of doing the same thing again. While volatility in and of itself is not risky, the amount of volatility in an investment is called its 'risk' – because of the risk that an investor will pull the plug out of fear when conditions get dreadful – thereby locking in those losses.
Equities can provide investors with higher overall performance – even doubling your investment dollars about every 11 years or so, but that performance can be accompanied by stressful downturns that can cause some of us to become prematurely gray from trying to resist capitulation at the low.
The most steady returns, especially during bearish periods, are usually obtained from fixed-income investments – but at the cost of significantly lower returns. This characteristic of the markets, with the price of higher returns being higher risk, has become accepted as a trait of the markets that cannot be overcome.
Today's Investment Vehicle of Choice: Because Exchange Traded Funds (ETFs) offer instant diversification (each ETF holds from dozens to thousands of individual positions), low costs, and easy of use, the vast majority of investors are abandoning mutual funds and individual stocks, turning to ETFs to achieve their investment objectives.
In fact, ETFs are the overwhelming favorite of today's investors, with assets growing at an annual rate of 25% per year and more than $2 trillion expected to flow into ETF products in 2018.
Using a buy-and-hold a combination of ETFs from these two divergent asset classes; simultaneously holding a stock-market index ETF (such as the S&P 500 ETF – SPY) and a fixed-income index ETF (such as the Vanguard Total Bond Market ETF – BND). Investment advisors usually recommend a blend in a ratio of 70% equities and 30% fixed income, gradually becoming more conservative as you get older.
But what if there were a better approach than this plain-vanilla, buy-and-hold approach used by so many investors? Well, many investors realize that since the infancy of investment markets, there has been a regular rotation in the regime of the market, withexpansive, bullish conditions regularly transforming into contracting, bearish conditions. Of course, the overarching driver of these various market regimes are changes in the business cycle itself.
That means constructive, bullish conditions are the underlying regime until the business cycle exhausts itself and bearish conditions take over when the business cycle contracts. and For example, the S&P 500 offers four different ETFs that take advantage of different market environments – whether conditions are bullish, bearish, or sideways (two ETFs are inverse and two are leveraged). Also, during any given period, different fixed-income investments will be outperforming their siblings. Of course, the problem is knowing which ETF to use and when to use it without making money-losing mistakes.
What if you could consistently own the optimum S&P 500-based ETF for current and near-future conditions to always attain the highest possible returns? And what if you could combine that investment with the always-optimal fixed-income ETF at any given time? By optimizing these two positions and trading just a few times a year, you can dramatically increase the return on your investment dollars.
The Return Difference is Phenomenal
As an example of this phenomenal return difference, a buy-and-hold combination of the SPDR S&P 500 ETF (SPY) with the Vanguard Total Bond Market ETF (BND), in a 70%-30% combination that many investors use for this objective, provides an annual return of just 7.74% in the last 20 years. However, by owning the optimal S&P 500-based ETF (of four) at any given time, combined with the optimal fixed-income ETF (of 53) at any given time, and trading an average of just you could receive an annual return of 26.79% – more than triple the annual return!
The financial results of that difference is phenomenal. For example, $100,000 placed in the buy-and-hold combination of the S&P 500 ETF (SPY) and the total bond market ETF (BND) would be worth $444,159 after 20 years. In comparison, that same $100,000 invested using our AA-2-2: Optimal S&P 500-based ETF & Optimal Fixed Income ETF Combination (2 ETF) Strategy, in the same 70%-30% combination, would be worth $11,526,568 after 20 years – yes, that's more than $11.5 million – a phenomenal 26-times the return you would have received in 20 years if using the SPY/BND 70-30 combination without our signals service.
We're pleased to inform you that this service is available to you now – provided by our Asset Allocation: Optimum S&P 500 & Fixed-Income (2 ETF) Strategy.
CONSTRUCTION OF THE STRATEGY
Asset Allocation: Optimum S&P 500 & Fixed-Income (2 ETF) Strategy is contructed of its two main components, S&P 500-based Exchange Traded Funds and the optimal Fixed Income ETF (of 53 high-volume ETFs) in a ratio of 70% - 30%.
The sophistication and effectiveness of the ETFOptimize strategies is truly a breakthrough that could revolutionize investing.