The SIA Hypothetical 5 Mutual Fund Model is designed for smaller-sized accounts that require the same level of care and attention but lack the capital for extensive diversification. This strategy operates on a quarterly basis, where holdings are monitored and rebalanced into the top five relative strength names, one from each of the top five relative strength mutual fund sectors. On January 3, 2024, the SIA Hypothetical 5 Mutual Fund Model purchased 58,712 units of SUNL100 at a price of $22.09, as Sun Life's India fund began to show movement beyond the $21 resistance level and was in the process of breaking out from a three-year trading range. SUNL100 is a constituent of the Favored SIA Global Asset Class Matrix Report and is currently in the Green Favored #6 position, as indicated in the snippet table above from this report. According to the rules-based investment strategy, shares of SUNL100 experienced a temporary decline from the favored zone in the spring when the India market underwent a correction compared to other global markets. The units were sold at $23.08 for a minor profit, primarily to manage risk. This adjustment was temporary; in late summer, SUNL100 shares surged back to the top of the SIA Global Asset Class Matrix Report. The shares were repurchased at $25.12 and are currently priced at $25.87, approaching resistance at $25.99. The relative strength of the units suggests potential movement towards the vertical count of $28.71 and further up to $32.35. Support levels are initially at the 3-box reversal level of $24.73 and further at $21.30, indicating a favorable risk-reward profile. Units of SUNL100 carry a SMAX score of 10 out of 10, reflecting a strong near-term indicator when compared against various asset classes, including cash, bonds, commodities, and both domestic and international investments.
Turning to the performance metrics of the SIA Hypothetical 5 Mutual Fund Model, the Compound Annual Growth Rate (CAGR) is 13.21% (gross of fees), compared to the model benchmark (60/40 Balanced) of 7.20%. Performance across all time frames shows outperformance, resulting in an Alpha reading of 2.81 versus 0.04 for the benchmark. Since inception (live for 10 years and backtested beyond), the SIA Model has increased by 695%, compared to 219% for the 60/40 benchmark. As noted in the investment strategy below, the other names in the portfolio also underscore the relative strength mandate, with top-ranked US Equity, NA Equity, NASDAQ, and Innovator classes all well represented.
Fund Selection Process: FOR ADVISOR USE ONLY - The hypothetical fund selection process recommends the top 5 relative strength ranked names, one each from the top 5 relative strength ranked mutual fund sectors. This model is rebalanced and monitored only on a quarterly basis. On a quarterly basis, the model is updated which looks to own only mutual funds within the top 5 relative strength ranked sectors. If the individual fund drops below the Favored zone on the quarterly update, it is sold and the model recommends to buy the top ranked fund within that sector universe with a 6 or higher SMAX score. During a quarterly rebalance period, a fund stays in the model if the sector is still ranked within the top 5 rankings and the fund is still found in the Favored zone of its respective sector report. We will not consider any Leveraged or inverse sectors for this strategy or US Currency Mutual Funds
Start Date: 2008-01-02
Primary Benchmark: SIA CAD 60/40 Balanced
Disclaimer: SIACharts Inc. specifically represents that it does not give investment advice or advocate the purchase or sale of any security or investment whatsoever. This information has been prepared without regard to any particular investors investment objectives, financial situation, and needs. None of the information contained in this document constitutes an offer to sell or the solicitation of an offer to buy any security or other investment or an offer to provide investment services of any kind. As such, advisors and their clients should not act on any recommendation (express or implied) or information in this report without obtaining specific advice in relation to their accounts and should not rely on information herein as the primary basis for their investment decisions. Information contained herein is based on data obtained from recognized statistical services, issuer reports or communications, or other sources, believed to be reliable. SIACharts Inc. nor its third party content providers make any representations or warranties or take any responsibility as to the accuracy or completeness of any recommendation or information contained herein and shall not be liable for any errors, inaccuracies or delays in content, or for any actions taken in reliance thereon. Any statements nonfactual in nature constitute only current opinions, which are subject to change without notice.
