Dynamic Asset Allocation
This approach has several features that are important for today’s investor.
What the system does:
- You are on the right side of the big market moves – whether up or down.
- DAA has a great pedigree – scientific testing by academics, tweaked and perfected by the NewArc team.
- Includes exposure to a wide range of ETFs, including emerging markets and precious metals.
- Shifts to bonds and/or inverse ETFs when necessary.
What the system does not do:
- It is not a buy-and-hold method. There is some adjustment 25 or 30 times a year.
- It does not react to every piece of news or each market move. Think big!
- It does not try to predict turning points.
This system is an excellent complement to a value investing program like Great Stocks. An investor in DAA should take a long-term viewpoint, measuring performance over a complete market cycle. The system should be profitable in either a major rally or a major decline. It might not beat the market, because it provides safety.
This is a great method on a risk/reward basis. You get most of the upside in good times, and you also make money in a 2008-type scenario.