The Milwaukee Company’s Smart-Beta Performance Report is a weekly review of the performance of ten indexes that are managed using “smart-beta” asset allocation theories. This Report is for informational purposes only and should not be regarded as a substitute for independent research and personalized investment advice.
Comments on this week’s report:
- As the stock market continues to rise, 100% equity strategies continue to outperform strategies that have exposure to fixed income securities (i.e. those listed as “Passive”) on both a month-to-date and year-to-date basis.
- Over the trailing 3-months Sector Rotation has been the clear winner as its largely overweight exposure to industrials and technology (i.e. nearly 30% each) has significantly contributed to its outperformance. However, over the trailing 1-year it is largely underperforming for the same reason.
- Contrary to Sector Rotation, Low-volatility is outperforming all other listed strategies by a large margin on a 1-year basis as it benefited from its relatively lower drawdown during the stock market correction at the end of 2018, while still participating in the more recent stock market rally.
- Despite the relatively poor performance from Momentum based equities over the trailing 1-year, over the trailing 3-year and 5-year periods they have largely outperformed as in those time frames the market has primarily experienced upward momentum.