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This Strategy Profile page provides you with an introduction to our NASDAQ Persistent Profits (1 ETF - QQQ/TLT) Strategy (abbreviated as "NPP-1") and a preview of its many features and benefits. On this page you'll find comprehensive data and detailed charts providing this quantitative strategy's historical and recent performance, its robust, profitable performance during the Financial Crisis, information documenting its exceptionally high Risk-Adjusted Return, and a clear accounting of the significant benefits that accrue to an investor by using this investment model's systematic guidance – while eschewing the old-style, discretionary investing approach based on error-prone judgments.
This chart shows the performance of our NASDAQ Persistent Profits (1 ETF - QQQ/TLT) Strategy since inception:
KEY: The red line is the NASDAQ Persistent Profits (QQQ/TLT) STRATEGY performance since inception.
The blue line shown as the benchmark is a buy-and-hold of the S&P 500 ETF (SPY).
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Our Strategy Profile (preview) pages provide investors with a weekly updated preview of the actual performance of our Premium Strategies. Most of the charts and tables in this Profile page are a duplicate of the same tables and charts you will find in your Premium Strategy (subscription) page after you register. This Profile page, of course, does not include Current Holdings, Closed Positions, or recent Transaction information – these are details you get – and much more – when you subscribe.
With a conservative Annualized Return of 27% for the Nasdaq Persistent Profits Strategy, it produces a total profit that is more than Quadruple the 5.49% Annualized Return for a buy-and-hold of its benchmark, the SPDR S&P 500 ETF (SPY) since Inception of this model (July 1, 2000). For a limited-time only, we are offering this strategy for just $19 per month.
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Note: Since the charts on this page are not logarithmic, recent volatility will appear more significant than past volatility – even if it is actually less in percentage terms. See the detailed performance charts below for further details.
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The NASDAQ Persistent Profits (QQQ/TLT) Strategy is designed to produce consistent, persistently positive investment profits in all types of market environments. The strategy always holds one of two widely owned ETFs, i.e., either the iShares Nasdaq 100 ETF (QQQ) when conditions are constructive for gains, or the iShares 20+ Year Treasury Bond ETF (TLT) as a defensive asset when the economy begins contracting at the end of a business cycle or the market declines from overbought conditions.
The NASDAQ Persistent Profits (QQQ/TLT) Strategy provides subscribers with an alternative to buying-and-holding the NASDAQ ETF (QQQ) – avoiding drawdowns and achieving far superior performance with a total return since inception that is more than ten-times (1,081%) the return of its benchmark, the S&P 500 ETF (SPY). In less than 14 years, every $100,000 invested became $2.6 million (compared to $332k for the S&P 500 ETF).
Despite the far higher performance, this strategy accomplishes those gains with much lower risk, documented by its Risk-Adjusted Return (RAR) Sharpe Ratio at a sky-high 1.87 and Sortino Ratio of 2.97 (compared to 0.62 and 0.80, respectively for the S&P 500 ETF, SPY), with trades having more than six months between, and with no money-losing years.
The PERSISTENT PROFITS strategy accomplishes this exceptional performance with NO LEVERAGED or INVERSE ETFs. Therefore, the two ETFs used in this model (QQQ and TLT) are available for use by European Union investors concerned with PRIIP regulations. There are no leveraged or derivative aspects involved with these ETFs.
UNIVERSE: The primary way the NASDAQ Persistent Profits (QQQ/TLT) Strategy outperforms the overall market or buy-and-hold is by accurately selecting QQQ during expansionary (bullish) periods and selecting TLT during contractionary (bearish) periods. While this sounds easy on its face, millions of investors have lost their shirt trying to accomplish this same task. In other words, it's easy to imagine but incredibly difficult to execute.
However, the team of Investment Design Professionals at ETFOptimize have a combined 50-years of experience in solving the most difficult investment challenges using sophisticated, algorithmically configured trading strategies that produce profits under every condition imaginable. The NPP-1 Strategy was just revised with the addition of a component from our Optimal
PERFORMANCE: The result of accurate position rotation is a NASDAQ Persistent Profits (1 ETF) Strategy that generates a very steady Average Annualized Return (AR) of about 27% per year, with an Average Annualized Max Drawdown (AAMDD) of just -8.2%. The strategy has an average of 75% winning trades since Inception. For further information on essential statistics, please see the Performance Statistics section just below.
Our abbreviated name for this strategy is 'NPP-1.'
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about this Strategy's Feb. 2, 2020 Revision
Data sources: Performance Statistics; Portfolio123, Standard & Poors Global Market Intelligence,
Compustat, S&P Capital IQ, St. Louis Federal Reserve. Most recent update: August 2019 (statistical averages are updated every 3-6 months).
Inception: July 1, 2007
Rebalance Frequency: Weekly
Weighting: 100% in 1 ETF (either EQUITY or DEFENSIVE, depending on conditions)
Benchmark: SPDR S&P 500 ETF (SPY)
(Higher is better)
Total Return since Inception: 2,508%
Avg. Annual Return (avg. per year since inception): 27.13%
BenchmarkS&P 500 ETF (SPY) Total Return since inception: 232.88%
Benchmark (SPY) Annualized Return since inception: 6.86%
Financial Crisis & Recovery Return: 30.16% (see "Financial Crisis Performance' below)
Avg. Yearly Percentage of Winning Trades: 75%
Biggest Winner / Biggest Loser: 66.23% / -2.84%
Average Position Hold Time: 128 market sessions (about 6.45 months)
Winning Trades Held for an average of: 162.58 market sessions (8.13 months)
Losing Trades Held for an average of: 23 market sessions (1.15 months)
(Lower is better)
Number of Money-Losing Years: ZERO of 14 = 0%
Number of Profitable Years: 14 of 14 (100%)
Strategy's Average Annual Max Drawdown (AAMDD)**: -8.21%
Benchmark's (SPY) Average Annual Max Drawdown (AAMDD)**: -13.9%
Strategy's Absolute Max Drawdown (MDD): -11.60%
Benchmark's (SPY) Absolute Max Drawdown (MDD): -55.19% (Oct. 2007-March 2009)
Strategy's Standard Deviation: 12.88%
Annualized Alpha: 24.12%
(Higher is better)
Sharpe Ratio - Since Inception: 1.87 (Compare to Benchmark, SPY, at 0.60)
Sharpe Ratio - Last 3 Yrs: 2.49 (Compare to Benchmark, SPY, at 0.89)
Sortino Ratio - Since Inception: 2.97 (Compare to Benchmark, SPY, at 0.77)
Sortino Ratio - Last 3 Yrs: 3.87 (Compare to Benchmark, SPY, at 1.10)
(Our abbreviated name for this strategy is "PP-1")
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For all data above: *Past performance is not necessarily indicative of future returns. **Average Annual Max Drawdown (AAMDD) is the average of the worst peak-to-trough drawdowns each year since inception, which we believe is the best representation of the worst peak-to-trough declines you might experience as a subscriber in any given year. We also provide the Maximum Drawdown (MDD) figures, which are the very worst drawdown instance that has occurred since inception.
A smooth, steadily climbing performance chart: As you can see from this chart that runs from the strategy's inception on July 1, 2000 to present, the NASDAQ Persistent Profits (1 ETF) Strategy provides a steady and consistent, upward ascent of its equity curve. The NASDAQ Persistent Profits Strategy consistently identifies the market's regime – whether economic conditions are in expansion or contraction – and determines whether QQQ or a TLT is appropriate for current conditions. The model also selects This continuous assessment of conditions and rotation of its position keeps your money growing month after month, and year after year.
With a compound annual growth rate of about 27%, this easy-to-use, 1-ETF strategy more than quadruples (417%-times) the average return of its benchmark (the S&P 500 ETF), and according to data provided by Morningstar, outperforms 100% of mutual funds in the last 3, 5, 10, and 20 year periods. Since inception in July 2007, thePersistent Profits Strategy has outperformed its benchmark every year since inception and has never experienced a money-losing year.
In the charts below, the NASDAQ Persistent Profits (1 ETF) Strategy's performance is shown by the red line while its benchmark, the SPDR S&P 500 ETF (SPY), is represented by the blue line.
KEY: The blue line shown as the benchmark is a buy-and-hold of the S&P 500 Index.
The red line is the NASDAQ Persistent Profits (QQQ/TLT) STRATEGY performance since inception.
Note: The charts on this page are not logarithmic. Therefore, recent volatility shown in the top graph (% Return) appears far greater than past volatility, even if it is less in percentage terms. To accurately compare recent volatility to past volatility, please see the lower-half (% Drawdown) of each 2-part graph.
KEY: The blue line shown as the benchmark is a buy-and-hold of the S&P 500 Index.
The red line is theNASDAQNASDAQ Persistent Profits (1 ETF) STRATEGY performance since inception.
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It's easy to see from a glance that the NASDAQ Persistent Profits Strategy displays a smooth, steady and persistent upward climb in its equity curve – without significant drawdowns. Here's a summary of the strategy's performance:
Average Annualized Return (2003-2019): 28.07%
Average Annual Max Drawdown: -8.21%
Average Annual Overall Winners: 75%
Winning Years: 14 of 14 (100%)
Years Outperforming S&P 500 ETF (SPY): 12 of 14 (86%)
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To demonstrate how theNASDAQ Persistent Profits strategy protects you from severe market losses while achieving exceptional performance, the best example we can provide is its performance during the 2007-2009 Financial Crisis.
The S&P 500 Index, which consists of 500 of America's premier companies, began plummeting in late 2007, continued downward throughout all of 2008 and through to early-2009, losing -57% of its value by the time it had bottomed on March 9, 2009. Meanwhile, the ETFOptimizeNASDAQ Persistent Profits Strategy had switched to a Defensive ETF position just before the downturn began. As stocks declined through the market bottom in March 2009, the model at no time operated at a loss and was showing a 32% profit. By the end of the crisis in 2013, this strategy outperformed the market by more than double!
The Left Chart below presents the 2007 High to Financial Crisis low. The downturn began at the October 9. 2007 high and continued with a drop of -56.78% in the S&P 500 at the trough of the Financial Crisis on March 9, 2009. You can see that our Persistent Profits Strategy moved in an upward assent the entire time the market was declining – during the worst 18 months for the stock market in a generation.
The Right Chart below shows the entirety of the tempestuous tale – from the beginning of the Financial Crisis through its recovery. This period is an excellent way to show how our Persistent Profits (Equity ETF/Defensive ETF) Strategy performed during these extreme conditions – providing a return of 256.50% to prudent investors who followed theNASDAQ Persistent Profits model decisions as it switched at the optimum time from Equity ETFs to Defensive ETFs – or Defensive ETFs to Equity ETFs.
The Persistent Profits (Equity/Defensive) Strategy more than tripled investor's funds during the Financial Crisis, turning a $100,000 investment into $356,496 in 5.5 years, while a buy-and-hold investor in America's premier companies (represented by the S&P 500 index) lost more than half of their assets in 18 months and required another four years to recover that loss (shown by the chart on the right) to get back to 0%.
2007 High to Financial Crisis Low – From the October 9, 2007 pre-Financial Crisis high to its low on March 9, 2009, this strategy's benchmark, the S&P 500 ETF (SPY), lost -55.19%. Meanwhile, the NASDAQ Persistent Profits Strategy subscribers watched the devastation unfold WITHOUT worrying about loss of their financial security. Instead, by the March 9 low, our NASDAQ Persistent Profits (QQQ/TLT) Strategy had gained 31.52% – beating the market by 87% and with 75% winning trades.
2007 High to Financial Crisis Low and 3.5-Year Recovery – This strategy's benchmark, the S&P 500 ETF (SPY), descended from the pre-Financial Crisis high on October 9, 2007 through its low on March 9, 2009 – dropping -55.19%. Then SPY required a total of five long years to return to breakeven. Meanwhile, our NASDAQ Persistent Profits (QQQ/TLT) Strategy instead returned 417.62% – turning an investor's savings of $100k into $517,623 – while most other investors gained NOTHING (0.60%) over five long years.
Eliminating significant market declines and the recovery time required is one of several ways the ETFOptimize strategies produce considerable outperformance. When this model's sophisticated market-timing and ETF-selection system detects that a downturn is imminent, it will rotate to the iShares 20-Year Treasury Bond ETF (TLT). During bullish trends, the model will hold the Invesco Nasdaq 100 ETF (QQQ.
Our NASDAQ Persistent Profits Strategy uses a sophisticated set of rules-based algorithms, made from a composite of as many as 38 key indicators (from the fields of macroeconomics, stock fundamentals, sentiment, and technical signals) to consistently and accurately rotate to the optimum ETF (QQQ or TLT) at all times, thereby producing a steady, ever-climbing equity curve and eliminating investor stress. This strategy does not use leveraged positions, but since July 1, 2000 through December 31, 2019, has produced a total return of about 2,400% – more than 10 times greater – with an Annualized Return that is 3.8 times greater than its SPDR S&P 500 ETF (SPY) benchmark.
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CALENDAR YEAR PERFORMANCE – BAR CHART
Yearly Performance Bar Chart: This chart tracks each strategy's performance for each calendar year since inception. You can see in the chart below that the performance of the NASDAQ Persistent Profits (QQQ/TLT) Strategy (red bars) has been profitable every year (indicated by red bars being above 0%), and in 12 of 15 years, the strategy (red bars) outperformed its S&P 500 benchmark (indicated by the strategy's red bars extending above the benchmark's blue bars).
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This table shows the NASDAQ-Persistent Profits Strategy's trading record since inception for Winning, Losing, and Total trades, as well as Realized (Closed) and Unrealized (still held) ETFs.
– Winning Trades stands near 80%, which is exceptionally high – even for a highly effective ETFOptimize strategy. High ratios for Winners-to-Losers is a proven recipe for a highly successful investment strategy. Also, the biggest winning trade gained 66.23% while the worst losing trade only declined by -2.84%.
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One of the most important measures of the effectiveness of an investment approach is its
Risk-Adjusted Return, commonly measured by the Sharpe Ratio or Sortino Ratio. These metrics show the ratio of an investment's performance to its volatility. The Sharpe Ratio measures performance against all volatility, while the Sortino Ratio measure performance against downside volatility only. Investors are prone to making emotionally based, injurious decisions when volatility gets high, so the industry has labeled this factor as 'risk.' A strategy with a high Risk-Adjusted Return is one that provides excellent upside performance with low volatility.
Notice the dramatic outperformance of this strategy when
those two ratios are compared to the strategy's benchmark - a buy-and-hold of the S&P 500-EW ETF (RSP). Since the inception of this strategy, the Sharp Ratio of the S&P 500-EW ETF (RSP) is 0.59 while its Sortino Ratio is 0.76 – compared to 1.12 and 1.75 (at the time of this writing) for this strategy. You can also see from the last entry on the bottom-right side of the table showing Alpha % (average annual outperformance of a portfolio compared to the performance of its benchmark) that this strategy outperforms the S&P 500 by an average of more than 15% per year! The actual, year-by-year outperformance is shown in the "Performance Stats - Yearly" table (above).
Sophisticated algorithms in the NASDAQ Persistent Profits strategy consistently selects the optimum ETF for conditions from a 2-ETF Universe, consisting of the Invesco NASDAQ 100 ETF (QQQ) and the iShares 20+ Year Treasury Bond ETF (TLT), representing equities and fixed-income assets, respectively.
Both of the assets in this strategy's universe (QQQ and TLT) are very popular, widely-traded ETFs and subscribers should be able to enter and exit the trades with ease. The spread on QQQ is usually 0.00% and the spread on TLT averages only 0.01%. Nearly instantaneous fills on each trade is the norm for individual investors with personal portfolios of as much as $50-$100 million. If you are investing more than $100 million when following the trades recommended by this model, or if you are an investment advisor with cumulative client assets greater than $100 million, please contact us for additional suggestions on the lowest-cost ways to accomodate your transaction needs.
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ROBUST GAINS DURING BOTH RALLIES AND DOWNTURNS: Selecting the appropriate asset class at the appropriate time – either a long equity representation from QQQ or a defensive bond representation from TLT – provides you with performance that is significantly more than the return of the broad market during bull rallies, while also producing gains (from TLT) during market downturns.
UNEMOTIONAL, EFFICIENT INVESTMENT DECISIONS: Using an emotion-free, mathematically driven trading system enables you to ignore the financial media, with its click-bait pessimistic market outlooks, coffee-fueled TV shysters, and hype-reliant internet frauds who attempt to surreptitiously hijack your wallet. Instead, your weekly ETFOptimize Strategy Update will quietly provide you with the accurate intelligence you need, with detailed documentation of trades when they occur, details of your strategy's performance for multiple time-frames, and a comprehensive set of statistics so you can quickly check your progress toward achieving your financial goals. Subscribers can sleep soundly know that their strategy is always selecting the optimum positions for conditions and perhaps most advantageous of all – knowing that by design, there is virtually no risk of losing money in any given year.
EASY TO USE: The ETFOptimize investment strategies seek to minimize the number of trades needed to attain their high performance, and on average, have 3.83 months between trades. For this strategy, the average hold time is 212 business days or about 10.6 months. When a transaction occurs, you receive straightforward recommendations that you can quickly execute with the click of a button at your broker's website. For investors who want to become familiar with each position, we provide a link to complete background data and relevant news for each ETF selected for use by the strategy.
The ETFOptimize strategies are unquestionably a breakthrough in the investment world – providing what legitimately may be the easiest way to attain substantial wealth through consistent compounding – with minimal risk. For investors, they can be the "Holy Grail" – a simple, proven investment approach that significantly gains ground through both bull markets and bear markets alike.
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2) Strategy Trade Alerts – With each weekly update you will receive a Strategy Update Summary email with any Strategy Trade Notices for that week, including the complete details of any trades recommended by your quantitative model, including links from each of your model's current holdings to historical prices, a wide variety of statistics, charts, and news related to that ETF and its industry. We recommend that you fill ETF transactions in the middle of the following day (Monday – or Tuesday if Monday is a holiday). Note: Across our strategies, the average trade hold time is about 3.85 months, so trades are relatively rare events, but those few trades are enough to make a world of difference!
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6) Perhaps Most Importantly – You'll get the potentially life-changing benefit of consistent and exceptional compound growth of your investment dollars without the stress and corrosive worry about a potential loss of your capital that accompanies most other investment approaches. Each of the ETFOptimize quantitative strategies over-weight on factors that help the models avoid financial loss – the number one cause of poor long-term performance
An average Sharpe ratio of 1.50 and an average Sortino Ratio of 2.21 consistently rank our strategies atop the lists of highest risk-adjusted return of any mutual fund, professionally managed portfolio, or quantitative investment models available to investors today. Why not put this steady stream of investment profits to work for you starting today?
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