Conservative Global ETF portfolio
Multi-Factor Ranking System
Research-based model utilizing a combination of specific price momentum and risk factors to improve total returns for a portfolio of fixed income investments.
“Glass Box” Portfolio Construction
Fully transparent process that quantitatively invests 70% of assets based on the Multi-Factor Ranking System and quantitatively allocates 30% of the assets towards current market opportunities.
Actively-Managed Passive Investments
Portfolio actively invests among a carefully defined list of ETFs, including domestic and international fixed income sectors, in an effort to eliminate manager tracking error and minimize trading costs.
1/1/2015 to 12/31/2017
*Gross Returns are presented before management fees, but after all trading expenses and all expenses charged by the underlying funds and investment vehicles. Net Returns are based on gross returns and are calculated by deducting the management fee charged both by Fund Architects, LLC., and any introducing advisor if applicable. Returns shown over one year are annualized. See below for additional disclosures.
Standard Deviation – Standard deviation is a statistical measurement of dispersion about an average, which, for an investment, depicts how widely the returns varied over the time period indicated. Morningstar computes standard deviation using the trailing monthly total returns for the time period. All of the monthly standard deviations are then annualized.
Alpha – Alpha measures the difference between an investment’s actual returns and its expected performance, given its level of risk as measured by beta. A positive alpha figure indicates the investment has performed better than its beta would predict. In contrast, a negative alpha indicates that the investment underperformed, given the expectations established by its beta. Alpha is often seen as a measure of the value added or subtracted by a portfolio manager.
Beta – Beta is a measure of an investment’s sensitivity to movements in a benchmark. A portfolio with a beta greater than one is more volatile than the benchmark, and a portfolio with a beta less than one is less volatile than the benchmark.
Sharpe Ratio – Sharpe ratio is calculated by taking the investment’s average monthly excess return over the user-defined risk-free rate and dividing by the monthly standard deviation of excess returns to determine reward per unit of risk. A higher Sharpe ratio reflects better historical risk-adjusted performance.
Up/Down Percentage Ratio – Up/Down percentage ratio is a measure of the number of periods that the investment outperformed/underperformed the benchmark when the benchmark had positive/negative returns. A larger/smaller ratio is better.
Currency – The currency used for data in the report is US Dollar (USD).
Benchmark – Barclays US Aggregate Bond Index is a market value-weighted index that tracks the daily price, coupon, pay-downs, and total return performance of fixed-rate, publicly placed, dollar-denominated, and nonconvertible investment grade debt issues with at least $250 million par amount outstanding and with at least one year to final maturity. An investment cannot be made directly in an index.