Strategy Description  

The style of equity investments is determined by size and value/growth characteristics. During the market cycle, different investment styles rotate in and out of favor.  This strategy attempts to take advantage of this rotation by using a rules-based approach to determine the top two ETFs to invest in from a basket of U.S. style ETFs.

During down markets, the model uses our downside risk protector© to invest in cash or short-term securities.  This allows for growth potential while managing risk.

The three company capitalization sizes – Small Cap, Mid Cap, and Large Cap – combined with Growth, Value, and Blend, or Core, create the nine different styles of companies.

The U.S. Style Rotation model rebalances monthly.


Sharpe Ratio – the average return earned in excess of the risk-free rate.  A higher Sharpe Ratio is better

Risk-Free Rate – represents the interest an investor would expect from an absolutely risk-free investment over a specified period of time.

Sortino Ratio – another measure of risk that takes into account the downside deviation of the asset.  A higher Sortino Ratio is better.

What is drawdown?

Drawdown is the measure from the highest high to the lowest low or peak to trough during a specific time period.  It is an important measurement of risk.  A larger drawdown requires a more significant increase in the security to recover.