Stock Upgrading is a strategy based on the observable phenomenon that recent performance tends to persist. This strategy uses Individual Stocks, Mutual Funds and ETFs (collectively, "Securities"). The strategy may invest in US Large-Cap Securities, US Small-Cap Securities, International Securities and/or commodities, depending on Stock Upgrading's current assessment of the momentum within each group. Securities are held as long as they demonstrate superior leadership among their peers. Each month the strategy re-assesses the current holdings and replaces lagging Securities with new leaders.
Enhanced DAA (EDAA) is a strategy designed to participate in bull market gains, while striving to reduce losses during bear markets. EDAA owns a variety of ETFs drawn from six broad asset classes. EDAA measures trend/momentum to dynamically shift the portfolio weightings assigned to each potential holding. Broadly speaking, EDAA will always allocate among a variety of stock, bond, and alternative holdings, but the weightings between the specific holdings will vary according to market conditions and their impact on each potential investment vehicle's trend. DAA is an all-weather strategy that has generated impressive back-tested results, in large part via its ability to play good defense during bear markets.
This strategy invests in a small number (normally 5, but up to 10) of stock funds and ETFs focused on specific sectors, like technology or financial services, demonstrating strong recent momentum. It’s a high-risk/high volatility strategy. While its peaks have been higher and its valleys lower than SMI’s other strategies, Sector Rotation has generated impressive long-term returns. The strategy is intended to comprise only a modest portion of your stock allocation.
Using index funds, we spread your allocation across the global stock market. Just-the-Basics is designed to match the performance of the market in a tax-efficient manner, so it is well-suited for use in taxable accounts.
We include bonds to provide safety and stability. This strategy combines a bond index fund base with rotating bond funds that vary in duration, credit rating, and type. Bond Upgrading evaluates its holdings each month and replaces lagging bond funds with those showing greater momentum.
* Although SMI Private Client covers all Charles Schwab commissions, SEC Fees will still apply, as will short-term redemption fees, if applicable. Health Savings Accounts may not receive free trades, since they are opened by third party administrators.