Advanced Market and Econometric Trend Signals
WBI has utilized domestic stock and fixed income trend models in our quantitative management process for nearly 30 years. The Trend Switch Strategies are designed to give moderate investors simple solutions to optimizing bull and bear market cycles.
Equity Model Design
The model is designed to combine macro-economic factors and technical market trends into one model to produce a “risk on” or “risk off” indication. Proprietary confidence scores analyze factor model data and technical trends to improve signal quality and performance outcomes. As factor and technical data improves or degrades, the confidence scores will influence “bull” or “bear” indications across each factor model. A combined confidence score determines whether the model is “risk on” or “risk off” signal.
Bond Model Design
The bond model considers interest rates, price momentum, yield, currency, and equity earnings to determine the optimal duration and credit quality for fixed income holdings. After analyzing these factors, the model pinpoints the most effective duration (short or long) and the best credit opportunities (US Treasuries, corporate, or high yield). As factor and technical data improves or degrades, the confidence scores will influence credit quality and duration signals for the model. Proprietary confidence scores analyze factor model data and technical trends to improve signal quality and performance outcomes.
Equity to Bond Model Design
Our blended Equity to Bond SMAs optimize risk and return by looking first to the Equity Model when conditions are deemed favorable for equity. If the model indicates conditions for risk are high in equities, we then look to the Bond Model to determine preference for bond type and duration or cash.
Trend Switch Strategies
|Strategy Name||“Risk On” Exposure||“Risk Off” Exposure||Strategy Inception|
|Bull|Bear Trend Switch US 1000||US Large Cap||US Short-Term Treasuries||7/31/1992|
|Bull|Bear Trend Switch US 1000|Bond||US Large Cap||US Fixed Income||10/31/2017|
|Bull|Bear Trend Switch US 2000||US Small & Mid-Cap||US Short-Term Treasuries||9/29/2017|
|Bull|Bear Trend Switch US 2000|Bond||US Small & Mid-Cap||US Fixed Income||10/31/2017|
|Bull|Bear Trend Switch US Bond||US Fixed Income||US Short-Term Treasuries||2/28/2018|
|Bull|Bear Trend Switch US 3000|Bond||US All Cap||US Fixed Income||2/28/2019|
Past performance does not guarantee future results. This is not an offer to buy or sell any security. No security or strategy, including those referred to directly or indirectly, is suitable for all accounts or profitable all of the time and there is always the possibility of loss. You should not assume that any discussion or information provided here serves as a substitute for personalized investment advice from WBI or any other investment professional. If you have questions regarding the applicability of specific issues discussed to your individual situation, please consult with WBI or your chosen professional advisor. This information is compiled from sources believed to be reliable, accuracy cannot be guaranteed. WBI’s advisory operations, services, and fees are in the Form ADV, available upon request.
During periods of high market volatility, a significant amount of holdings may be sold, resulting in a large allocation to cash or cash equivalents. At times, market conditions and the particular Portfolio Strategy, may call for an allocation of 100% to cash or cash equivalents. If the portfolio strategy invests all or a substantial portion of its assets in cash or cash equivalents for extended periods of time, including when it is investing for temporary defensive purposes, it could reduce the strategy’s potential return as the limited returns of cash or cash equivalents may lag other investment instruments in a strong market.