Investment Performance

Schultz Financial Mgmt Corp

Risk-Controlled Portfolios for Serious Investors

Our Investment Strategies

Our Core Fixed Income Strategies

Core - High Quality Bonds

This strategy is uniquely managed for each client on a case by case basis. It primarily invests in individual high quality bonds with consideration given to credit risk, yield, maturities, income needs, and tax implications. By owning individual bonds rather than bond funds, we can receive a full return of principal by holding the bonds to maturity. We generally favor treasury inflation protected treasury bonds, agency bonds, and tax free municipal bonds with this strategy. The objective of this investment strategy is to reduce overall portfolio risk and provide income as needed.

Core - Trust Deed Fund

This strategy invests in a private mortgage fund which consists of many short term commercial loans backed by real estate. These loans may be for new construction, renovation, small commercial properties, land, mixed use properties, and other special use properties. Private mortgage funds typically maintain a stable net asset value. However, it is possible a loan default could result in a reduction of the net asset value of the fund. The objective of this investment strategy is to earn annual total returns of 8% or more and add stability to the overall portfolio.

Our Core Stock Strategies

Core - Dividend Income Stocks

This strategy invests primarily in U.S. large cap dividend paying stocks. This strategy will normally be invested in 20 stocks and remain fully invested throughout a full business cycle. Stocks are selected using a strict screening process and monitored daily utilizing a quantitative ranking system. Specific stocks are sold if they suffer a large price decline in high trading volume because of bad news. The portfolio is limited to a maximum of five banking stocks and 5 energy related stocks in order to ensure prudent diversification. The objective of this investment strategy is to outperform the Dow Jones Industrial Average with similar volatility.

Core - Quality Growth Stocks

This strategy invests primarily in U.S. large cap dividend paying stocks. This strategy will normally be invested in 20 stocks and remain fully invested throughout a full business cycle. Stocks are selected using a strict screening process and monitored daily utilizing multiple quantitative ranking systems. Lower ranked stocks are regularly pruned from this strategy in favor of stocks that we believe are more likely to realize above average appreciation in the next few months. A stock will also be sold if it suffers a large price decline in high trading volume because of bad news. The portfolio maintains general sector weightings similar to that of the S&P 500 index but will overweight favored industry groups within a sector. The objective of this investment strategy is to outperform the S&P 500 index with similar volatility.

Our Core Real Estate Strategies

Core - REITs

This investment strategy invests in 10 publicly traded Real Estate Investment Trusts and will typically remain fully invested throughout a full market cycle. This strategy invests primarily in U.S. equity REITs. This strategy is diversified but generally favors the residential and health care sectors because they tend to be less correlated with the economy. The objective of this strategy is to earn income exceeding 5% per year from dividends and to outperform the Dow Jones Equity REIT Index. This strategy also serves to diversify the overall portfolio.

Core - Apartment Buildings

This strategy is uniquely managed for each client on a case by case basis. This strategy invests primarily in apartment buildings that have positive cash flow which is regularly distributed to the investors. Investors typically own fractional shares in three or more apartment building in different cities. This is a passive investment with a managing investment partner that oversees the operation of the property. These are tax advantageous as investors may be able to deduct depreciation, mortgage interest, and other expenses. The objective of this strategy is to earn investment returns exceeding 10% per year and add stability to the overall portfolio.

Our Trend Following Fixed Income Strategy

Trend - High Yield Bonds

This strategy normally invest in high yield corporate bond fund. If a down trend develops in high yield corporate bonds, this strategy will switch to a money market fund, a government bond, foreign bond fund, or other fixed income fund that is in an up trend. This strategy many invest in mutual funds or ETFs. The objective of this strategy is to earn annual total returns of 7% or more while add stability to the overall portfolio.

Our Trending Stock Strategies

Trend - Large Cap Stocks

During normal market conditions, this strategy will hold the same 20 stocks as our Quality Growth Stock strategy with sector weightings similar to the S&P 500 index. If the S&P 500 index begins to trend downward, we will hedge downside risk by selling a portion of the stocks and buying a hedging instrument to offset against further declines. When the downtrend is exhausted, the hedge is removed and the strategy will return to a fully invested position as a new upward trend develops. The objective of this strategy is to outperform the S&P 500 index during favorable market conditions and preserve capital during market declines.

Trend - Mid Cap Stocks

During normal market conditions, this strategy will hold 20 mid cap stocks with sector weightings similar to the S&P 400 index. If the S&P 400 index begins to trend downward, we will hedge downside risk by selling a portion of the stocks and using the proceeds to buying a hedging instrument to offset against further declines. When the downtrend is exhausted, the hedge is removed and the strategy will return to a fully invested position as a new upward trend develops. The objective of this strategy is to outperform the S&P 400 index during favorable market conditions and preserve capital during market declines.

Trend - Global ETFs

This strategy normally invests in 3 to 7 exchange traded funds experiencing the strongest upward trends evaluated on risk-adjusted basis. Candidate ETFs include U.S. style and sector funds, global regional funds, and country specific funds including Japan, Korea, China, India, Russia, Brazil, Germany, England, France, Spain, and many more. During global stock market down trends, this strategy's stock market exposure will be reduced in order to protect against further stock market declines. The objective of this strategy is to participate in the best performing global markets, outperform the S&P 500 index, and preserve capital during global stock market declines.

Definition of Terms

Investment Portfolio:

This is an investor's entire investment portfolio not including home, personal property, and liquid funds needed for living expenses and emergencies.

This would include brokerage accounts, IRAs, annuities, rental property and company retirement plans such as 401(k)s.

This portfolio would be tailored to meet an an investors objectives, and regularly monitored and adjusted in order to control risk.

Core and Trend:

The terms "core" and "trend" are used to describe an investment strategy or approach.

The "core" investment strategies are long-term in nature and tend to stay fully invested throughout a full market cycle, whereas the "trend" investment strategies follow a trend following or market-timed investment approach.