etfmsolutions: T2 ALL IN Bond/FI...4.4.13

Thursday, April 4, 2013

T2 ALL IN Bond/FI...4.4.13

Questions continue regarding a REALLY low maintenance portfolio that will at least get close to SPY returns without the volatility. This is one solution using the previously posted Bond and FI (fixed income) model. This is not a recommendation to invest in these ETFs, just showing as what's possible without precise cherry picking of the components.
In this case we've made DVY ( our recent #1 ranker) as our benchmark and then created and all in model by simply selecting top 11.
What's attractive about this sort is that linearity (RSQ) of the model is .97 (the higher the number the closer to a straight line) and while the shorter term metrics of the top 11 sort do lag DVY (DOW dividend yield ETF) it's the drawdown numbers that stand out (a SKEW of 0 would mean no volatility.
If you run this model yourself you will note that of the 10 6 month component charts only 4 have upslope RSQ lines....which makes the shorter term returns even more surprising.

Below the T2 chart is the present trend of the SPY TrendX (live on the right side panel)...which is arguing for a continued bull market...until proven otherwise by a break in the yellow trendline.

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Mosaic Solutions commentary is typically published daily as time permits and market action warrants.
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