Schultz Financial Mgmt Corp

 

Risk-Controlled Portfolios for Serious Investors

 
   

   

 

 

 

 

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Investment Strategy 

 

 

 

 

 

Trend-High Yield Bond

 

Investment Strategy Statistics

(As of 10-12-2007)

 

Timed   Bond  

 LB Aggr Index 
2007  Return 7.16% 3.71%
2006 Return 7.28% 4.40%
2005 Return 2.93% 2.47%
2004 Return 4.59% 4.34%
2003 Return 28.27% 4.10%

 

Investment performance figures are based on actual results of a representative client.  These figures are net of a maximum 1% investment management fee for accounts greater than $500,000. 

 

 

Objective:

 

The objective of this strategy is to achieve above average yields in bonds with moderate risk.    

 

Investment Approach:

 

This trend following strategy may invest in bond ETFs, closed-end bond funds, or traditional bond mutual funds.  Normally this strategy will invest in high yield corporate bond fund.  If a down trend develops in high yield bonds, this strategy may switch to a money market fund, or a government bond fund in order to preserve capital..

 Back-Test

We performed a simulated "back-test" to validate the effectiveness of our proprietary market timing strategy for bonds prior to 2003.  The test results are shown below:

 

Year    Timed   LB Index

 

1997     24.2%      9.6%

1998     13.3%      8.7%

1999       3.2%     -0.9%

2000       6.0%    11.6%

2001       8.6%     8.5%

2002     12.4%    10.3%

 

Our back-test simulation used daily closing price data of mutual fund data from 1997 though 2002 compared with the LB Aggregate Bond Index. 

 

The simulated back-test performance shown above does not include money management fees.

 

 
   
   

 

© Schultz Financial Management 2002