The Stock Bond Rotation Model (SBRM) is meant to assist the average investor looking to minimize effort, trading and fees and maximize risk adjusted returns.

The SBRM allows you to choose from three different portfolios: Aggressive, Moderate and Conservative. Each portfolio operates off of the same rules-based trading system but differs in the magnitude of adjustments made within the portfolio based on changes in the overall market. The Aggressive, Moderate and Conservative portfolios aim for a long-term Stock/Bond mix of (70%/30%), (50%/50%) and (40%/60%) respectively. All these portfolios, including the Conservative portfolio, outperforms the S&P 500 starting at the beginning of our data in 1976 until current day. Our model tells you when, where and how much to move your portfolio allocation. Simply see the chart above and select your preferred portfolio!

The SBRM relies on passive investing; making changes in the portfolios less than 2 times per year on average since 1976. This is where the true power of the SBRM resides. You get better returns while trading less.

The weakness of the SBRM is that you are not investing in single security investments, like a individual stock. Instead, you are utilizing ETF’s that mimic the overall returns of the S&P 500 Index and/or the Barclays US Aggregate Bond Index. This means that you are not going to “hit it big” on any particular company. Rather, this model aims at relying on time tested, proven, signals that tell the tide of the economy and adjust accordingly to provide superior risk adjusted returns.