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In My Opinion
What's Happening at Flexible Plan
Last Week in the Market
Strategy Performance
Gold
Quantified Funds
Diversified Bonds
Diversified Tactical Equity
Dynamic Fund Profiles
Faith Focused Investing
Fusion
Lifetime Evolution
Market Leaders
Other Custodians
Select Alternatives
Strategic Solutions


Disclosures
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To our readers
Everything in the newsletter pertains to strategies available on our Strategic Solutions platforms at Trust Company of America and Jefferson National Monument Advisor VA. The same strategies are implemented on many other products: mutual funds, variable annuity, variable life and retirement platforms. Therefore, we expect the strategic discussion may be of interest to you. Note, however, that since these products have their own subaccount and fund universes and different internal expenses, the results and trading of the same strategy on other platforms may differ substantially from those described herein.



Managed Retirement Plan Participants:

Most of you are managed using Lifetime Evolution and our sub-advised funds, so those topics will be most applicable to your account. But, more and more of you are in plans using Next Generation and Market Leaders. If so, those newsletter sections may interest you.


 
  April 22, 2014        
  In my opinion
by Ron Rowland
     
  About Ron Rowland
Ron Rowland of Capital Cities Asset Management is the guest author of this week's "In My Opinion." Having run a hedge fund, a mutual fund, and now managed accounts, Ron has experience in both money management and investment publications. Ron developed his own fund/equity momentum indicators in the 1980s and has continued to refine them over the years. Quoted widely in the financial press, Ron is the industry go-to guy for sector rotation insight and ETFs, and has had his work published in Forbes, Seeking Alpha, TheStreeet.com, MarketWatch.com and others. Ron offers the following primer on the basics of active management.
 
     

Slicing Onions

I’m not a trained chef, yet like many people, I can often be found in the kitchen preparing meals. I like my food on the hot and spicy side, which typically means the recipe includes an onion as one of the ingredients. Unfortunately, I’ve never encountered a recipe that said to throw the whole onion into the mix. The recipe always calls for you to slice, dice, chop, or mince the darn thing first. That’s where the fun begins, because there are many ways to prepare an onion, and I’ve been known to try a completely new way every now and then.

It’s a similar story for investments. The entire investment universe is immense, consisting of stocks, bonds, commodities, and myriad alternatives. For this discussion, we’ll keep things simple and only talk about stocks. However, with tens of thousands of stocks in the world, it might be easier to get a handle on the situation if we sliced them into smaller, more manageable pieces.

A common way to accomplish this task is to categorize each stock by its sector and industry. There are many stock classification systems in use today, with the Industry Classification Benchmark (“ICB”) and the Global Industry Classification System (“GICS”) among the most popular. Dow Jones and FTSE maintain the ICB database, while MSCI and Standard & Poor’s developed the GICS methodology. Although each uses slightly different terminology, both classify all stocks into ten major sectors and further divide them into industries, groups, and subsectors – four levels in all.

There are many investment products focusing on the ten major GICS sectors. You’ll find indexes, mutual funds, and exchange traded funds (“ETFs”) tracking the performance of each and providing targeted exposure.

Now that we have a way to divide the universe into more manageable pieces, we still need a method to help determine where to invest.

Relative strength analysis is one of the approaches Flexible Plan uses and is an effective way to gain insight into what is going on (or what is working) in the market at any given time. Relative strength is an easy to understand investment approach. In its simplest form, it compares the total return of two securities over a predetermined time-period and then invests in the stronger one, while avoiding the other.

However, selecting the time period is a huge variable. As active money managers and relative strength practitioners, are we interested in identifying the securities with the greatest relative strength over the past week, month, year, or some other timeframe?

As you can well imagine, analyzing different intervals will often reveal that the strongest securities of the past week have little overlap with the strongest of the past year. Choosing too short of a period can produce false starts, whipsaws, and excessive trading. Meanwhile, too long of a period can miss new opportunities and stay in fading trends too long.

Performing relative strength analysis on ETFs tracking the ten major sectors quickly reveals where the market’s strengths and weaknesses reside. Using an intermediate timeframe of about a couple months indicates Utilities and Energy are the two strongest sectors. A month ago, the Utilities sector was strong while Energy was not. This suggests market strength is rotating into Energy. Consumer Staples, Telecommunications, and Materials are three other sectors that are currently above average when looking at intermediate relative strength.

The Industrials sector sits just below the half-way point, but is still registering positive performance over the period being evaluated. This brings up another point: a relative strength ranking alone doesn’t tell us if the various categories are trending upward, downward, or sideways. Being on top could mean a sector is falling slower than the lower ranked categories. It is easy to overcome this limitation by including a neutral investment, such as a money market fund, into the mix. Another way is to quantify the relative strength calculations. Those with positive results are trending upward, and those with negative results are trending down.

This extra data reveals the next two sectors (Financials and Technology) in our relative strength ranking are nearly flat with no obvious trend. The bottom two sectors are Health Care and Consumer Discretionary. They are the weakest from an intermediate relative strength viewpoint. Additionally, their negative total return over the interval suggests they are in downward trends.

Of course, this is a current view of the market based on sectors. However, much like our onion that can be sliced and chopped many different ways, so can the market, and Flexible Plan has many different strategies that do just that. Instead of dividing by sectors, what if we sliced and categorized stocks based on geographical regions or various fundamental and technical factors? Once again, there are indexes, mutual funds, and ETFs that make this possible.

Using the same methodology on a handful of countries and regions instead of sectors shows that Latin America currently has the strongest relative strength. Next in line would be the category known as Pacific excluding Japan. These developed markets include Australia, Hong Kong, Singapore, and New Zealand. Canada and Europe would also be above average.

Weaker regions and countries include the U.K., the U.S., and China. Japan is running behind all of the others mentioned. Plus, its negative score indicates a downward trend. Russia isn’t included in the mix because of its small market footprint, but if it were included, it would rank even lower than Japan.

The nine-square Morningstar style box is another way to slice the market. It separates stocks into three sizes (Large, Medium, and Small) and further divides them into Value, Growth, or Blend buckets. Running the same relative strength analysis against this universe, as is done with the Market Leaders strategies, reveals Large-Cap Value and Mid-Cap Value stocks are the strongest and in generally positive trends. Meanwhile, Small-Cap Growth and Small-Cap Blend stocks have the lowest relative strength and are trending lower.

It’s also possible to chop up the stock market based on a single quantitative factor, such as yield, volatility, size, revenue, momentum, and many others. Additionally, there are investment vehicles tracking these too. Current Yield, Value, Low Volatility, and Dividend Growth are the factors behind the stocks that are performing well now. Buybacks, Spin Offs, Momentum, and Small Size are among the factors currently out of favor.

Relative strength is just one tool available to active managers. This tool, combined with the ability to slice and dice the market along many different lines, provides active managers with the potential to identify and overweight the strongest areas of the market and to avoid the weakest. Of course, you could always take the passive approach of throwing the whole unsliced onion in and hoping for the best – definitely not how Flexible Plan cooks.



All the best,

Ron




Disclosures


In My Opinion
What's Happening at Flexible Plan
Last Week in the Market
Strategy Performance
Gold
Quantified Funds
Diversified Bonds
Diversified Tactical Equity
Dynamic Fund Profiles
Faith Focused Investing
Fusion
Lifetime Evolution
Market Leaders
Other Custodians
Select Alternatives
Strategic Solutions


Disclosures
 
  April 22, 2014      
Top of page
  What's happening at Flexible Plan

A Better Buy & Hold

After a brief closure for enhancement, effective today we are reopening A Better Buy & Hold for new accounts and strategy changes.

A Better Buy & Hold was developed in 1998 to help minimize taxes from capital gains on taxable accounts. It begins by dividing the portfolio of domestic equity mutual funds into twelve separate buckets, one for each month.  Each bucket is traded and held for a minimum of 52 weeks so that one-twelfth of the portfolio is traded each month, hence a “better” buy and hold approach. A 20% allocation to alternative funds, also divided into twelve buckets, each held for one year, is included in the portfolio.

Along with optimization of the Evolution trading methodology for the strategy, the funds available for trading within A Better Buy & Hold were rescreened and filtered for tax efficiency and low turnover. Financial Advisors with questions are invited to contact our Sales Department (dial extension 2 or email us at sales@flexibleplan.com).


In My Opinion
What's Happening at Flexible Plan
Last Week in the Market
Strategy Performance
Gold
Quantified Funds
Diversified Bonds
Diversified Tactical Equity
Dynamic Fund Profiles
Faith Focused Investing
Fusion
Lifetime Evolution
Market Leaders
Other Custodians
Select Alternatives
Strategic Solutions


Disclosures



 
  April 22, 2014      
Top of page
  Last week in the market

Bulls run again

Stocks got a lift last week as the pace of China’s economic growth topped forecasts and Fed chair Janet Yellen stated that the central bank has a “continuing commitment” to supporting the economy. The weekly gains: NASDAQ, 2.39% to 4,095.52; Dow, 2.37% to 16,408.54; S&P 500, 2.71% to 1,864.85. 4,5,6

% Change Y-T-D 1-Yr Chg 5-Yr Avg 10-Yr Avg
DJIA
-1.01
+12.24
+20.36
+5.70
NASDAQ
-1.94
+27.80
+28.96
+10.52
S&P 500
+0.89
+20.16
+22.89
+6.44
Real Yield 4/17 Rate 1-Yr Ago 5-Yrs Ago 10-Yrs Ago
10Yr TIPS Yd
0.52%
-0.64%
1.70%
1.87%

  March
DJIA
0.83%
NASDAQ
-2.53%
S&P 500
0.84%

Sources: USATODAY.com, bigcharts.com, treasury.gov - 4/17/14 6,7,8,9
Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly.
These returns do not include dividends.



Consumer prices advance 0.2%

In reviewing March’s mild increase in household inflation, two statistics stand out. The Consumer Price Index measured a 2.7% year-over-year rise in shelter costs (the largest annual gain in six years). Americans also paid 0.4% for food last month. Annualized consumer inflation reached 1.5% in March, up from 1.1% for February. 1



March puts households in a buying mood

Retail sales rose 1.1% last month, bettering the (revised) 0.7% advance in February. Census Bureau data showed core retail sales (minus auto buying) up 0.7% for March; they increased 0.3% a month earlier. 2



Factories & Builders grow busier

According to Federal Reserve data, March was another solid month for industrial output – production rose 0.7%, and the Fed revised the February advance to 1.2%. Groundbreaking by builders increased 2.8% in March, though the Census Bureau also measured a 2.4% decline in building permits. 2,3



Citations

1 - marketwatch.com/story/consumer-prices-rise-02-in-march-2014-04-15 [4/15/14]
2 - briefing.com/investor/calendars/economic/2014/04/14-18 [4/17/14]
3 - latimes.com/business/money/la-fi-mo-housing-starts-20140416,0,4151864.story [4/16/14]
4 - bloomberg.com/news/2014-04-16/u-s-stocks-maintain-gains-as-yellen-signals-support.html [4/16/14]
5 - google.com/finance?q=INDEXDJX:.DJI&ei=5IRQU7iUAaSsiQK1Kw [4/17/14]
6 - usatoday.com/money/markets/overview/ [4/17/14]
7 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=4%2F17%2F13&x=0&y=0 [4/17/14]
7 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=4%2F17%2F13&x=0&y=0 [4/17/14]
7 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=4%2F17%2F13&x=0&y=0 [4/17/14]
7 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=4%2F17%2F09&x=0&y=0 [4/17/14]
7 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=4%2F17%2F09&x=0&y=0 [4/17/14]
7 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=4%2F17%2F09&x=0&y=0 [4/17/14]
7 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=4%2F16%2F04&x=0&y=0 [4/17/14]
7 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=4%2F16%2F04&x=0&y=0 [4/17/14]
7 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=4%2F16%2F04&x=0&y=0 [4/17/14]
8 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [4/17/14]
9 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [4/17/14]


In My Opinion
What's Happening at Flexible Plan
Last Week in the Market
Strategy Performance
Gold
Quantified Funds
Diversified Bonds
Diversified Tactical Equity
Dynamic Fund Profiles
Faith Focused Investing
Fusion
Lifetime Evolution
Market Leaders
Other Custodians
Select Alternatives
Strategic Solutions


Disclosures



 
  April 22, 2014      
Top of page
  Gold

That GOLD is mine

As we wait to see if the $1200.00 price level holds during the current period of consolidation, gold mining costs have almost doubled since 2008.


Source: Thomson Reuters GFMS, ASA Research

The chart shows that production costs have been a major factor in the rise of Gold prices, providing an increasing floor of support. So, what are the reasons for this rise in costs and will they continue going forward – producing increasingly higher Gold prices?

Reasons for rising Gold Mining production costs:

  • Many Gold Mines are old and in decline.
  • Mining costs are increasing because extraction requires going deeper for deposits.
  • In developed countries, mining is restricted due to environmental regulations.
  • Many Gold deposits are located in remote and inhospitable regions.
  • Some countries are even moving towards nationalizing their Gold Mines.



  Hedged Gold Bullion
Top of page

Hedged Gold Bullion gave up 1.41% last week. The 65% allocation in The Gold Bullion Strategy Fund (QGLDX) was responsible for most of the weekly declines for the total portfolio. A 25% hedging position with the ProFunds-Short Precious Metals Fund (SPPSX) was in place for three days of the four-day week (except Tuesday), contributing only 0.06% of the portfolio’s weekly losses.


  TVA Gold
Top of page

TVA Gold, a new strategy that will be available for client accounts next week, uses a volatility-adjusted exposure to Gold that attempts to offer a return profile similar to Gold, while also reducing risk relative to Gold. TVA Gold exposure for the week was 60%, indicating a risk higher than our target of 9%. The strategy was down 1.25%, while The Gold Bullion Strategy Fund was down 2.00% for the week. In ideal situations such as last week, TVA Gold will outperform the performance of Gold in down periods, capturing the majority of upward movements.

Disclosures

     
  TVA Gold trades The Gold Bullion Strategy Fund (QGLDX) using Flexible Plan’s proprietary Targeted Volatility Analysis (TVA). TVA uses the precious metal’s past volatility to position the account in a portfolio divided between the gold bullion fund and a money market or bond mutual fund. The objective of the strategy is to allow participation in a portion of the returns of gold while targeting a lower level of risk. The advantage of this is the opportunity to create a return stream equivalent to that experienced with equities but at less risk than either gold or the S&P 500 Index has historically yielded.  
     


  The Gold Bullion Strategy Fund
Top of page

Over last week, the Gold spot price declined 1.8% as the US Dollar strengthened firmly. The Gold Bullion Strategy Fund (QGLDX) lost 2.0% for the week. The difference was partially due to QGLDX’s early close at 1:30PM (rather than 4:00PM). The prices of short-duration fixed income ETF holdings were lower on average over last week, while the COMEX Gold futures contracts dropped 1.9%.

 


In My Opinion
What's Happening at Flexible Plan
Last Week in the Market
Strategy Performance
Gold
Quantified Funds
Diversified Bonds
Diversified Tactical Equity
Dynamic Fund Profiles
Faith Focused Investing
Fusion
Lifetime Evolution
Market Leaders
Other Custodians
Select Alternatives
Strategic Solutions


Disclosures



 
  April 22, 2014      
Top of page
  Quantified Funds

US equity markets were up during last week’s shortened holiday trading week. The NASDAQ Composite gained 2.39%, the S&P 500 was up 2.71%, and the Dow Jones Industrial Average recorded a weekly gain of 2.38%. All ten of the S&P industrial sectors were up for the week. The move upward was led by Energy (4.67%), Industrials (3.59%), and Materials (3.13%). Except for the Quantified Managed Bond Fund (QBDSX), which was down 0.20%, the Quantified Funds were up, though not as much as the broad equity indices. The largest gain was in the Quantified All-Cap Equity Fund (QACFX, 1.93%), followed by the Quantified Market Leaders Fund (QMLFX, 1.85%), and then the Quantified Alternative Investment Fund (QALTX, 1.16%).

The Quantified All-Cap Equity Fund (QACFX) made very slight changes last week, shifting its weightings in four leading stock baskets, which remained at over 50% of the portfolio’s composition: “All-Cap Takeover” (18.0%), “CMPS-Double 10 Dividend & Growth” (13%), “CMPS-Price Momentum” (11%), and “All-Cap-Dividend Yield” (10%). Among domestic sector distributions, Information Technology and Consumer Discretionary continued to lead with portfolio allocations of 16% and 15%, respectively. The largest stock holdings in the All-Cap portfolio were in the common stock of Sanderson Farms, Inc. (SAFM, 2.5%) and the common stock of Benchmark Electronics, Inc. (BHE, 2.2%).

The cash level within the All-Cap Fund decreased to 10% last week. The Fund’s daily pattern trading of S&P 500 futures began the week 6% long, changed to 8% short on Wednesday’s close and 16% short on Thursday’s close to begin this week. Our TVA-based futures hedge position began the week 20% short, changed to 4% short on Monday’s close, 15% short on Tuesday’s close, and 10% short on Thursday’s close to begin this week. 

The Market Environment Indicator (MEI) remained bullish throughout the week, directing a continued 100% equity exposure in the Quantified Market Leaders Fund (QMLFX). Total sector ETF weightings for the fund were maintained at 30%, distributed in Energy (8%), Utilities (8%), Financial Services (4%), Telecommunications (4%), Basic Materials (2%), Consumer Services (2%), and Natural Resources (2%).

Most equity asset class allocations in the Quantified Market Leaders Fund changed last week: Developed Countries increased from 6% to 12%, Emerging Markets increased from 12% to 18%, Large-Cap Value increased from 10% to 12%, Mid-Cap Growth decreased from 6% to 4%, Small-Cap Growth decreased from 18% to 12%, and Small-Cap Value decreased from 18% to 12%. The individual ETF positions with the leading portfolio weightings were the iShares MSCI Turkey Index ETF (TUR, 4.5%), the Rydex S&P 500 Pure Value ETF (RPV, 3.3%), the iShares MSCI Russia Capped Index ETF (ERUS, 3.0%), and the iShares MSCI Australia ETF (EWA, 3.0%).

Within the Quantified Alternative Investment Fund (QALTX), the Long/Short Market Neutral Alternative sub-portfolio made a few small changes: allocation to the Catalyst Strategic Insider Fund (STVAX, 2.7) decreased, while the allocation to the ProFunds Short Precious Metals Fund (SPPIX, 2.1%) increased.

Among the largest ETF positions there were a few changes: allocation to the Claymore S&P Global Water ETF (1.9%) decreased, while allocation to the Market Vectors Nuclear ETF (NLR, 1.5%) increased.

The cash level within the Fund rose to 36.5% last week. The daily pattern trading of S&P 500 Index futures with 10% fund capital allocation began the week 3% long, changed to 4% short on Wednesday’s close and 8% short on Thursday’s close to begin this week. The 7.5% capital allocation of the volatility-based systematic trading of NASDAQ 100 Index futures was 4.5% long Monday, changed to 3% long on Monday’s close, back to 4.5% long on Wednesday’s close, and 3% long on Thursday’s close to begin this week.

Both of the Quantified Managed Bond Fund’s (QBDSX) two leading broad-bond index ETF holdings, the Vanguard Total Bond Market ETF (BND, -0.28%) and the PIMCO Total Return ETF (BOND, -0.48%), were down for the week.

The 10-year US Treasury yield increased to 2.72% for the week. The Fund increased weightings in the SPDR Barclay’s Capital International Treasury Bond ETF (BWX) from 8.8% to 10.3% and in the iShares Barclay’s Aggregate Bond ETF (AGG) from 4.5% to 5.3%, while decreasing allocations in the Vanguard Total Bond Market ETF (BND) from 10.8% to 10% and in the iShares iBoxx $ High Yield Corporate Bond ETF (HYG) from 9.7% to 5.8%.

The 5% active portfolio exposure to 30-Year US Treasury Bond futures in the Fund started the week neutral, changed to short at Monday’s (4/14) close, switched to long at Tuesday’s (4/15) close, and remained in that direction to start this week. The position lost around 1.17%.


Fund (Inception) Symbol Qtr Ending 3/31/14 1 Year Ending 3/31/14 Since Inception Ending (4/17/14) Annual Expense Ratio
The Gold Bullion Strategy Fund (7/5/13) QGLDX 6.44% N/A 3.92% 1.55%
Quantified Managed Bond Fund (8/9/13) QBDSX 2.02% N/A 1.96% 1.68%
Quantified All-Cap Equity Fund (8/9/13) QACFX (1.37%) N/A 2.42% 1.51%
Quantified Market Leaders Fund (8/9/13) QMLFX 0.86% N/A 5.85% 1.71%
Quantified Alternative Investment Fund (8/9/13) QALTX 0.75% N/A 7.41% 2.20%

The performance data quoted represents past performance; past performance does not guarantee future results. The investment return and principal value of an investment will fluctuate and an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be higher or lower than the performance data quoted.  For current performance, please call 1-855-647-8268.

Risks associated with the Quantified Funds include active frequent trading risk, aggressive investment techniques, small and mid-cap companies risk, counter party risk, depository receipt risk, derivatives risk, equity securities risk, foreign securities risk, holding cash risk, limited history of operations risk, lower quality debt securities risk, non-diversification risk, investing in other investment companies (including ETFs) risk, shorting risk, asset backed securities risk, commodity risk, credit risk, interest risk, prepayment risk, and mortgage backed securities risk.  For detailed information relating to these risks, please see prospectus.

The principal risks of investing in The Gold Bullion Strategy Fund are Risks of the Sub-advisor’s Investment Strategy, Risks of Aggressive Investment Techniques, High Portfolio Turnover, Risk of Investing in Derivatives, Risks of Investing in ETFs, Risks of Investing in Other Investment Companies, Leverage Risk, Taxation Risk, Concentration Risk, Gold Risk, Wholly-owned Corporation Risk, Risk of Non-Diversification and interest rate risk. “Gold Risk” includes volatility, price fluctuations over short periods, risks associated with global monetary, economic, social and political conditions and developments, currency devaluation and revaluation and restrictions, trading and transactional restrictions.

An investor should consider the investment objectives, risks, charges and expenses of each Quantified Fund and The Gold Bullion Strategy Fund before investing. This and other information can be found in the Funds’ prospectus, which can be obtained by calling 1-855-647-8268. The prospectus should be read carefully prior to investing in The Quantified Funds or The Gold Bullion Strategy Fund.

There is no guarantee that any of the Quantified Funds or The Gold Bullion Strategy Fund will achieve their investment objectives.


Disclosures

     
  For more information on the Quantified Funds, sub-advised by Flexible Plan Investments, Ltd., please review the prospectus and fund performance.

Current or historical holdings of the funds
 
     

In My Opinion
What's Happening at Flexible Plan
Last Week in the Market
Strategy Performance
Gold
Quantified Funds
Diversified Bonds
Diversified Tactical Equity
Dynamic Fund Profiles
Faith Focused Investing
Fusion
Lifetime Evolution
Market Leaders
Other Custodians
Select Alternatives
Strategic Solutions


Disclosures



 
  April 22, 2014      
Top of page
  Diversified Bonds

Diversified Bonds fell 0.50% last week, as all of its six portfolio components lost ground. Systematic Long/Short Bond Trading fell the most, reversing its fortunes from the previous week.

Strategy Weekly returns YTD-March returns Allocation
Diversified Bond Portfolio -0.50% 0.51%  
Global Maturities -0.30% 0.91% 31%
Managed Income -0.11% 1.66% 21%
Managed Income - 100% SAF -0.25% -7.67% 17%
Managed Income Aggressive -0.83% 10.54% 5%
Strategic High Yield Bond -0.05% 2.07% 13%
Systematic Long/Short Bond Trading -2.20% -8.81% 13%



  Strategic High Yield Bond
Top of page

Strategic High Yield Bond continued to hold its 100% invested position in a high-yield bond fund, falling 0.05% for the week.

Disclosures
     
  Diversified Bonds implements strategic diversification within the broad fixed income asset classes, ranging from domestic to global debt, and from government to high yield bonds. It is a blend of six actively managed fixed income strategies maintained and monitored by Flexible Plan Investments, each of which follows a rules-based discipline designed to best manage interest rate and other fixed income asset class market conditions utilizing no load index mutual funds. The Diversified Bonds portfolio seeks out allocations in the leading fixed income strategies that, when combined, seek to yield the highest return with a low level of targeted drawdown typical of a conservative portfolio. More information  
     


In My Opinion
What's Happening at Flexible Plan
Last Week in the Market
Strategy Performance
Gold
Quantified Funds
Diversified Bonds
Diversified Tactical Equity
Dynamic Fund Profiles
Faith Focused Investing
Fusion
Lifetime Evolution
Market Leaders
Other Custodians
Select Alternatives
Strategic Solutions


Disclosures



 
  April 22, 2014      
Top of page
  Diversified Tactical Equity

Diversified Tactical Equity gained 1.36% last week, as eight of its ten component strategies posted gains. Classic, Market Leaders Dynamic Aggressive, Political Seasonality Index, Self-adjusting Trend Following and Systematic Advantage gained more than 2% each.

Strategy Weekly returns March returns Allocation
Diversified Tactical Equity 1.36% -1.52%  
Classic 2.21% 0.13% 7%
Contrarian S&P Trading -0.05% -0.52% 11%
Gold Equities Trading -0.24% -1.24% 12%
Market Leaders Dynamic Aggressive 2.25% 0.58% 10%
Political Seasonality Index 2.34% -0.97% 6%
S&P Tactical Patterns 1.38% -3.73% 12%
Self-adjusting Trend Following 2.40% -5.11% 11%
Systematic Advantage 2.51% 0.36% 10%
Third Day Tactical Blend 0.86% -1.47% 12%
Volatility Adjusted NASDAQ 1.09% -2.68% 11%


Disclosures

     
  Diversified Tactical Equity implements strategic diversification within a selection of actively managed tactical strategies maintained and monitored by Flexible Plan Investments. Each of the strategies follows a rules-based discipline designed to best manage equity index and other asset class risk under various market conditions, utilizing no load index mutual funds. The Diversified Tactical Equity portfolio seeks to allocate within the leading tactical strategies that, when combined, seek to maximize return while reducing drawdown below a target level suitable for a growth-oriented investor. Each quarter the weightings among the eight component strategies will be reviewed and may be adjusted in accordance with Flexible Plan's proprietary technology. More information  
     
 
  Classic Update
Top of page

Classic gained 2.21% last week, as all four of its positions gained, with three gaining more than 2% each. All Classic, Growth and DAAP accounts continued to hold their equity positions, as our time-tested econometric model maintained its optimistic view of US equity prices.

  Political and Seasonal Tendencies
Top of page

Political Seasonality Index gained 2.34% last week, and held its 50% 2X Dow Jones Industrial Average-based position all week.

PSI Chart

  S&P Tactical Patterns
Top of page

S&P Tactical Patterns had a 60% long exposure to the S&P 500 Index for the first three days of last week, but reverted to 80% short exposure to the index over last Thursday (4/17), and increased its short position going into this week. The strategy gained 1.38% last week.


Disclosures

     
  S&P Tactical Patterns seeks out daily patterns in the S&P 500 Index price direction. Markets reflect human emotions. Investors adopt patterns of behavior in response to those emotions. S&P Tactical Patterns seeks out high probability, repeatable patterns in the S&P 500 Index to identify periods to buy, use leverage, or go short (or inverse) to the market. More information  
     


  Self-adjusting Trend Following
Top of page

Four short days almost reversed the previous week's losses. The NASDAQ 100 rose 2.54%, its first weekly gain in a month, and only the second weekly gain in the past six weeks. The index is still in a bad negative trend, where it has been setting a series of lower highs and lower lows going back to the first week in March. A close this week above 3600 on the NASDAQ 100 would be the first step in breaking this downward momentum.

Three of the well-known stocks in the NASDAQ 100 reported mixed earnings. Intel reported less revenue but higher profits, and the stock rose after the report. Google missed on both revenue and profit, and its stock fell 6% afterward. Google is off 11.5% from its 52-week high. Yahoo! reported a beat on both the top and bottom line, sending the stock higher by almost 10%.

It's expected that STF will remain 1X long this week as it seems unlikely that the market will rally enough to push STF back to 2X. Cash is still weeks away even if the current downtrend remains in place.


 

 
  Third Day Tactical
Top of page

Third Day Tactical Blend gained 0.86% and Third Day Tactical Blend Balanced gained 0.63% last week. The model had us in a 1X long position through Tuesday, which produced a gain, then moved us into a small short (inverse) position for Friday, which gave back a piece of the week’s gain to date. We held the inverse position into today (Monday).


Weekly returns YTD-March returns
Third Day Tactical Blend 0.86% -1.47%
Third Day Tactical Blend Balanced 0.63% -1.26%
  Volatility Adjusted NASDAQ
Top of page

With the recent volatility in the NASDAQ, VAN has pulled back exposure to less than 100%. For the shortened week, VAN was 60% long on Monday and Friday, but only 40% long on Tuesday and Wednesday. It also signaled to pull back once more to 40% for this week. With a less than 100% allocation, VAN did not participate fully in last week’s 2.5% move higher in the NASDAQ. As long as market uncertainty translates to higher volatility, VAN will maintain its lower exposure going forward. VAN was up 1.09% for the week.


Disclosures

     
  Volatility Adjusted NASDAQ evaluates the current short-term volatility risk in the NASDAQ 100 Index relative to its long-term historical average on a daily basis. Equity markets do best during periods of low volatility, while most declines are presaged by higher volatility. The VAN strategy takes advantage of this relationship. In addition, it utilizes the market trend to seek to avoid missed opportunities and market declines not detected in advance by measures of volatility. More information  
     


In My Opinion
What's Happening at Flexible Plan
Last Week in the Market
Strategy Performance
Gold
Quantified Funds
Diversified Bonds
Diversified Tactical Equity
Dynamic Fund Profiles
Faith Focused Investing
Fusion
Lifetime Evolution
Market Leaders
Other Custodians
Select Alternatives
Strategic Solutions


Disclosures



 
  April 22, 2014      
Top of page
  Dynamic Fund Profiles

All DFP suitability profiles continued the re-sampled efficiency portfolio allocations instituted for the quarter in early February. Ranked as the best performing suitability-based group of strategies at Strategic Solutions and Schwab for the first quarter in 2014, they continued to gain across all profiles during last week.

Dynamic Fund Profiles (DFP) Current Allocations:

  Quantified Market Leaders Fund (QMLFX) Quantified All-Cap Equity Fund (QACFX) Quantified Managed Bond Fund (QBDSX) Quantified Alternative Investment Fund (QALTX) The Gold Bullion Strategy Fund (QGLDX)
DFP Conservative 14.8% 24.0% 27.2% 24.2% 9.8%
DFP Moderate 22.5% 25.5% 21.2% 21.1% 9.7%
DFP Balanced 25.1% 26.7% 14.5% 24.0% 9.7%
DFP Growth 27.5% 28.3% 7.5% 27.0% 9.7%
DFP Aggressive 29.7% 29.6% 1.7% 29.5% 9.5%

Dynamic Fund Profiles (DFP) Recent Net-of-Fee Performance:

 

Weekly Return
(4/14-4/17/2014)

YTD-March Returns
DFP Conservative 0.71% 1.92%
DFP Moderate 0.87% 1.35%
DFP Balanced 0.99% 0.92%
DFP Growth 1.12% 0.58%
DFP Aggressive 1.22% 0.44%


Disclosures

     
  Dynamic Fund Profiles uses the latest in asset allocation technology – Resampled Efficiency. A patented process, Resampled Efficiency seeks to overcome deficiencies in traditional optimization, namely the assumption that each asset class will return exactly what history has shown. It builds uncertainty into its analysis resulting in increased diversification. More information  
     

In My Opinion
What's Happening at Flexible Plan
Last Week in the Market
Strategy Performance
Gold
Quantified Funds
Diversified Bonds
Diversified Tactical Equity
Dynamic Fund Profiles
Faith Focused Investing
Fusion
Lifetime Evolution
Market Leaders
Other Custodians
Select Alternatives
Strategic Solutions


Disclosures



 
  April 22, 2014      
Top of page
  Faith Focused Investing

Faith Focused Investing portfolios ended up for the week. Led by broad-based asset classes, all positions but one gained value last week. There were changes to the portfolios last week and all portfolios were fully invested according to their risk profile.

For last week, the Faith Focused Investing portfolios returned:

Faith Focused Investing portfolios
Weekly returns YTD-March returns
Faith Focused Investing Aggressive 1.74% -0.30%
Faith Focused Investing Growth 1.35% -0.12%
Faith Focused Investing Balanced 1.14% 0.01%
Faith Focused Investing Moderate 0.97% 0.07%
Faith Focused Investing Conservative 0.59% 0.27%

Disclosures
     
  Faith Focused Investing is based on the same investment management techniques that have, since 1998, approximated the S&P 500 Index in total return with less risk in our For A Better World strategy. Flexible Plan ranks the performance of the available funds on an ongoing basis, regularly screening and rotating the funds in each client's portfolio to keep them invested in the top ranked, qualifying funds. For more information go to: http://www.faithfocusedinvesting.com  
     

In My Opinion
What's Happening at Flexible Plan
Last Week in the Market
Strategy Performance
Gold
Quantified Funds
Diversified Bonds
Diversified Tactical Equity
Dynamic Fund Profiles
Faith Focused Investing
Fusion
Lifetime Evolution
Market Leaders
Other Custodians
Select Alternatives
Strategic Solutions


Disclosures



 
  April 22, 2014      
Top of page
  Fusion

This past week portfolios performed right in line with their risk profiles. The performance ranged from 3.85% to 0.36% from the most aggressive to the most conservative portfolio allocations. The degree to which a portfolio advanced was largely due to allocation to net-long equity positions at the beginning of the week. No adjustments were made to portfolio allocations among strategies during the week. However, the individual strategies may have made position changes internally during the week.


Fusion portfolios Weekly returns YTD-March returns
Fusion Aggressive 3.85% -7.55%
Fusion Growth 3.32% -6.88%
Fusion Balanced 2.52% -5.41%
Fusion Enhanced Income 2.01% -4.55%
Fusion Moderate 1.71% -3.82%
Fusion Conservative 0.84% -2.50%


  FUSION underlying allocations
   
FUSION Conservative Allocation
1.2X Government Bond 17%
2X S&P 500 10%
2X Emerging Markets 2%
Strategic High Yield Bond 2%
Classic 26%
Managed Income Aggressive 10%
Managed Income - 100% SAF 7%
Inverse NASDAQ 100 1%
Inverse Russell 2000 5%
Inverse Precious Metals 3%
Money Market 6%
Hedged Gold Bullion 5%
TVA Gold 5%

FUSION Moderate Allocation
1.2X Government Bond 15%
2X S&P 500 20%
2X Emerging Markets 5%
Classic 27%
Managed Income Aggressive 12%
2X NASDAQ 100 4%
Inverse Russell 2000 4%
Inverse Precious Metals 3%
Hedged Gold Bullion 5%
TVA Gold 5%

FUSION Enhanced Income Allocation
1.2X Government Bond 14%
2X S&P 500 23%
2X Emerging Markets 6%
Classic 25%
Managed Income Aggressive 10%
2X NASDAQ 100 7%
Inverse Russell 2000 4%
Inverse Precious Metals 2%
Hedged Gold Bullion 5%
TVA Gold 5%

FUSION Balanced Allocation
1.2X Government Bond 10%
2X Russell 2000 1%
2X S&P 500 29%
2X Emerging Markets 7%
Classic 20%
Managed Income Aggressive 8%
2X NASDAQ 100 10%
Inverse Russell 2000 3%
Inverse Precious Metals 2%
Hedged Gold Bullion 5%
TVA Gold 5%

FUSION Growth Allocation
1.2X Government Bond 5%
2X Russell 2000 4%
2X S&P 500 36%
2X Emerging Markets 8%
Best Tech 1%
Classic 14%
Managed Income Aggressive 4%
2X NASDAQ 100 17%
Hedged Gold Bullion 5%
TVA Gold 5%

FUSION Aggressive Allocation
2X Russell 2000 5%
2X S&P 500 36%
2X Emerging Markets 9%
Best Tech 5%
Classic 6%
2X International Developed 8%
2X NASDAQ 100 21%
Hedged Gold Bullion 5%
TVA Gold 5%


  FUSION PRIME underlying allocations
   
FUSION PRIME 5 Allocation
1.2X Government Bond 14%
2X Dollar 2%
2X S&P 500 5%
Strategic High Yield Bond 3%
Classic 20%
Managed Income Aggressive 6%
Managed Income - 100% SAF 14%
Third Day Tactical Blend Balanced 2%
Inverse NASDAQ 100 3%
Inverse Russell 2000 5%
Inverse Government Bond 2%
Inverse S&P 500 2%
Inverse Precious Metals 3%
Money Market 11%
Hedged Gold Bullion 5%
TVA Gold 5%

FUSION PRIME 6 Allocation
1.2X Government Bond 16%
2X S&P 500 7%
Strategic High Yield Bond 3%
Classic 23%
Managed Income Aggressive 8%
Managed Income - 100% SAF 12%
Third Day Tactical Blend Balanced 1%
Inverse NASDAQ 100 1%
Inverse Russell 2000 6%
Inverse Precious Metals 4%
Money Market 10%
Hedged Gold Bullion 5%
TVA Gold 5%

FUSION PRIME 7 Allocation
1.2X Government Bond 17%
2X S&P 500 9%
2X Emerging Markets 2%
Strategic High Yield Bond 2%
Classic 24%
Managed Income Aggressive 9%
Managed Income - 100% SAF 9%
Inverse NASDAQ 100 1%
Inverse Russell 2000 5%
Inverse Precious Metals 4%
Money Market 8%
Hedged Gold Bullion 5%
TVA Gold 5%

FUSION PRIME 8 Allocation
1.2X Government Bond 17%
2X S&P 500 10%
2X Emerging Markets 2%
Strategic High Yield Bond 2%
Classic 26%
Managed Income Aggressive 10%
Managed Income - 100% SAF 7%
Inverse NASDAQ 100 1%
Inverse Russell 2000 5%
Inverse Precious Metals 3%
Money Market 6%
Hedged Gold Bullion 5%
TVA Gold 5%
FUSION PRIME 9 Allocation
1.2X Government Bond 18%
2X S&P 500 11%
2X Emerging Markets 3%
Classic 28%
Managed Income Aggressive 12%
Managed Income - 100% SAF 5%
Inverse Russell 2000 5%
Inverse Precious Metals 3%
Money Market 4%
Hedged Gold Bullion 5%
TVA Gold 5%

FUSION PRIME 10 Allocation
1.2X Government Bond 18%
2X S&P 500 13%
2X Emerging Markets 3%
Classic 28%
Managed Income Aggressive 13%
Managed Income - 100% SAF 3%
2X NASDAQ 100 2%
Inverse Russell 2000 5%
Inverse Precious Metals 3%
Money Market 3%
Hedged Gold Bullion 5%
TVA Gold 5%

FUSION PRIME 11 Allocation
1.2X Government Bond 18%
2X S&P 500 14%
2X Emerging Markets 3%
Classic 30%
Managed Income Aggressive 14%
2X NASDAQ 100 2%
Inverse Russell 2000 5%
Inverse Precious Metals 3%
Money Market 1%
Hedged Gold Bullion 5%
TVA Gold 5%
FUSION PRIME 12 Allocation
1.2X Government Bond 17%
2X S&P 500 15%
2X Emerging Markets 5%
Classic 29%
Managed Income Aggressive 14%
2X NASDAQ 100 3%
Inverse Russell 2000 5%
Inverse Precious Metals 3%
Hedged Gold Bullion 5%
TVA Gold 5%

FUSION PRIME 13 Allocation
1.2X Government Bond 16%
2X S&P 500 17%
2X Emerging Markets 5%
Classic 28%
Managed Income Aggressive 14%
2X NASDAQ 100 3%
Inverse Russell 2000 4%
Inverse Precious Metals 3%
Hedged Gold Bullion 5%
TVA Gold 5%

FUSION PRIME 14 Allocation
1.2X Government Bond 15%
2X S&P 500 20%
2X Emerging Markets 5%
Classic 27%
Managed Income Aggressive 12%
2X NASDAQ 100 4%
Inverse Russell 2000 4%
Inverse Precious Metals 3%
Hedged Gold Bullion 5%
TVA Gold 5%
FUSION PRIME 15 Allocation
1.2X Government Bond 14%
2X S&P 500 21%
2X Emerging Markets 6%
Classic 26%
Managed Income Aggressive 11%
2X NASDAQ 100 6%
Inverse Russell 2000 4%
Inverse Precious Metals 2%
Hedged Gold Bullion 5%
TVA Gold 5%

FUSION PRIME 16 Allocation
1.2X Government Bond 14%
2X S&P 500 23%
2X Emerging Markets 6%
Classic 25%
Managed Income Aggressive 10%
2X NASDAQ 100 7%
Inverse Russell 2000 4%
Inverse Precious Metals 2%
Hedged Gold Bullion 5%
TVA Gold 5%

FUSION PRIME 18 Allocation
1.2X Government Bond 12%
2X S&P 500 27%
2X Emerging Markets 6%
Classic 23%
Managed Income Aggressive 9%
2X NASDAQ 100 8%
Inverse Russell 2000 3%
Inverse Precious Metals 2%
Hedged Gold Bullion 5%
TVA Gold 5%
FUSION PRIME 20 Allocation
1.2X Government Bond 10%
2X Russell 2000 1%
2X S&P 500 29%
2X Emerging Markets 7%
Classic 20%
Managed Income Aggressive 8%
2X NASDAQ 100 10%
Inverse Russell 2000 3%
Inverse Precious Metals 2%
Hedged Gold Bullion 5%
TVA Gold 5%

FUSION PRIME 22 Allocation
1.2X Government Bond 8%
2X Russell 2000 3%
2X S&P 500 33%
2X Emerging Markets 7%
Classic 18%
Managed Income Aggressive 6%
2X NASDAQ 100 12%
Inverse Russell 2000 2%
Hedged Gold Bullion 5%
TVA Gold 5%

FUSION PRIME 24 Allocation
1.2X Government Bond 7%
2X Russell 2000 4%
2X S&P 500 35%
2X Emerging Markets 8%
Classic 16%
Managed Income Aggressive 5%
2X NASDAQ 100 14%
Inverse Russell 2000 2%
Hedged Gold Bullion 5%
TVA Gold 5%
FUSION PRIME 28 Allocation
1.2X Government Bond 2%
2X Russell 2000 5%
2X S&P 500 36%
2X Emerging Markets 9%
Best Tech 4%
Classic 12%
Managed Income Aggressive 3%
2X NASDAQ 100 19%
Hedged Gold Bullion 5%
TVA Gold 5%
FUSION PRIME 32 Allocation
2X Russell 2000 5%
2X S&P 500 36%
2X Emerging Markets 9%
Best Tech 5%
Classic 6%
2X International Developed 8%
2X NASDAQ 100 21%
Hedged Gold Bullion 5%
TVA Gold 5%


Disclosures

     
  Fusion is our flagship core portfolio management approach which draws on the over 33 years of experience Flexible Plan has in researching and utilizing hundreds of different investment strategies and innovative risk management techniques. Fusion employs strategic diversification, a revolutionary way of measuring and managing risk, and incorporates an algorithm to evaluate and manage asset category correlation. All of these tools are used together to enhance performance and manage risk in a dynamic fashion so that portfolios can adapt to changing market conditions. For more information click here: http://www.flexibleplan.com/public/fusion-portfolio.aspx  
     

 


In My Opinion
What's Happening at Flexible Plan
Last Week in the Market
Strategy Performance
Gold
Quantified Funds
Diversified Bonds
Diversified Tactical Equity
Dynamic Fund Profiles
Faith Focused Investing
Fusion
Lifetime Evolution
Market Leaders
Other Custodians
Select Alternatives
Strategic Solutions


Disclosures



 
  April 22, 2014      
Top of page
  Lifetime Evolution

The Lifetime Evolution portfolios ended the week up. All but two positions and The Gold Bullion Strategy Fund experienced losses during the week. There were changes to the portfolios and all portfolios were fully invested according to their risk profile.

Last week, the Lifetime Evolution profiles returned:

Lifetime Evolution profiles
Weekly returns YTD-March returns
Lifetime Evolution Aggressive 1.56% -1.42%
Lifetime Evolution Growth 1.39% -1.18%
Lifetime Evolution Balanced 1.21% -1.00%
Lifetime Evolution Moderate 1.02% -0.74%
Lifetime Evolution Conservative 0.48% -0.15%

Disclosures
     
  Lifetime Evolution, an exclusively price momentum based strategy that can move to a 100% cash position, has 12 suitability-based investor profiles and is available on most of our investment platforms, including Strategic Solutions. More information  
     


In My Opinion
What's Happening at Flexible Plan
Last Week in the Market
Strategy Performance
Gold
Quantified Funds
Diversified Bonds
Diversified Tactical Equity
Dynamic Fund Profiles
Faith Focused Investing
Fusion
Lifetime Evolution
Market Leaders
Other Custodians
Select Alternatives
Strategic Solutions


Disclosures



 
  April 22, 2014      
Top of page
  Market Leaders

A strong rally last week recovered the majority of the prior week’s losses. All of the major indexes gained in excess of 2%, despite the shortened trading week.

Last week marked another round of Q1 earnings announcements with the majority of companies beating Wall Street estimates.

This week earnings releases will increase and may well determine the market’s trend. Earnings estimates had been lowered by severe weather hitting the country in the first quarter, so investors will be looking not only at how well companies did last quarter, but also at  estimates for the current quarter.

On an absolute basis, it was an up week with all asset classes and Market Leaders strategies showing positive returns. The leading index for the week was the S&P 500, a large-cap blend. Fortunately, the leading asset classes within Market Leaders are heavily weighted to large and mid-caps and were able to keep up.

Market Leaders Strategic & Tactical
Rank
  Asset Class % change (4/11-4/17/14)  
#1   Mid-Cap Value 2.5%  
#2   Large Value 2.6%  
#3   Large Growth 2.7%  
#4   Small Value 2.3%  
         
    S&P 500 Index 2.7%  
    All Country World Index 2.2%  
    Aggregate Bond Index -0.2%  

Renewed strength in stocks reduced investor interest in bonds, which gave back part of the prior week’s gains.

SECTORS

Sectors rallied along with the overall market, with Technology showing the strongest gains.

Previous Leading Sectors % change (4/11-4/17/14)
Banking 1.4%
Technology 3.1%
Electronics 2.3%
Health Care 1.8%

Source: FastTrack, S&P 500 (sp-cp), Mid-Cap Value (IWS), Small-Cap Value (IWN), Small-Cap Growth (IWO), Large Value (IWD), Russell 2000 (RUT-I), Russell Mid Cap (RUM-I), Russell Large Cap (RUI-I), Aggregate Bond Index (AGG), Developed Countries (EFA), Mid Cap Growth (IWP), All Country World Index (ACWI), Value Line Arithmetic Average (VLE-I), U.S. Ten Year Treasury Yield (US10-) Biotechnology (RYOAX), Technology (RYTAX), Internet (RYIAX), and Leisure (RYLAX)

Dynamic Weekly returns YTD-March returns
Market Leaders Dynamic Aggressive 2.25% 0.58%
Market Leaders Dynamic Growth 1.77% 0.78%
Market Leaders Dynamic Balanced 1.31% 0.94%
Market Leaders Dynamic Moderate 0.82% 1.21%
Market Leaders Dynamic Conservative 0.29% 1.36%
Strategic Weekly returns YTD-March returns
Market Leaders Strategic Aggressive 2.19% -0.55%
Market Leaders Strategic Growth 2.12% -1.45%
Market Leaders Strategic Balanced 1.83% -1.92%
Market Leaders Strategic Moderate 1.36% -1.75%
Market Leaders Strategic Conservative 0.77% -1.32%
Tactical Weekly returns YTD-March returns
Market Leaders Tactical Aggressive 2.20% -0.05%
Market Leaders Tactical Growth 1.68% 0.25%
Market Leaders Tactical Balanced 1.12% 0.60%
Market Leaders Tactical Moderate 0.63% 0.89%
Market Leaders Tactical Conservative 0.21% 1.21%

Disclosures
     
  Market Leaders invests only in the leading funds of the leading asset classes, based on historical price momentum. It is available in three versions: Strategic (with no market timing), Tactical (which can move up to 50% in cash during market corrections) and Dynamic (which, in addition to cash, can use short sales for defensive purposes.) Strategic and Tactical are available on most platforms, while Dynamic is restricted to platforms that offer Rydex, Direxion or ProFunds. For more information go to: http://www.ontargetinvesting.com/home/marketlead.aspx  
     


In My Opinion
What's Happening at Flexible Plan
Last Week in the Market
Strategy Performance
Gold
Quantified Funds
Diversified Bonds
Diversified Tactical Equity
Dynamic Fund Profiles
Faith Focused Investing
Fusion
Lifetime Evolution
Market Leaders
Other Custodians
Select Alternatives
Strategic Solutions


Disclosures



 
  April 22, 2014      
Top of page
  Other Custodians

ETF

The Rotational No-Load ETF/SAF, Rotational No-Load ETF, and Market Leaders Strategic ETF portfolios all posted positive returns for the week. This has been the first week in at least five weeks that the higher beta, high growth, momentum-based styles have outperformed the market as a whole. Furthermore, it has also been the first week in at least five weeks that there was a perfect positive correlation between strategy risk profile and subsequent return for the week. The most aggressive strategies benefitted to the tune of 2.00% to 3.50%, while the most conservative strategies faired relatively worse, returning 1.40% to 0.40%. The higher risk profile portfolios were helped by their allocation to US equities, while the more conservative risk profiles lagged because of their larger money market allocations.

ETF Market Leaders portfolios
Weekly returns YTD-March returns
ETF Market Leaders Aggressive 3.42% -2.01%
ETF Market Leaders Growth 3.24% -3.08%
ETF Market Leaders Balanced 3.06% -3.61%
ETF Market Leaders Moderate 2.46% -2.89%
ETF Market Leaders Conservative 1.43% -2.04%

Rotational No-Load ETF portfolios
Weekly returns YTD-March returns
Rotational No-Load ETF Aggressive 2.23% -1.52%
Rotational No-Load ETF Growth 1.77% -1.55%
Rotational No-Load ETF Balanced 1.30% -1.31%
Rotational No-Load ETF Moderate 0.85% -1.07%
Rotational No-Load ETF Conservative 0.40% -0.86%

Rotational No-Load ETF/SAF portfolios
Weekly returns YTD-March returns
Rotational No-Load ETF/SAF Aggressive 1.95% -0.58%
Rotational No-Load ETF/SAF Growth 1.67% -0.90%
Rotational No-Load ETF/SAF Balanced 1.42% -1.16%
Rotational No-Load ETF/SAF Moderate 1.02% -1.17%
Rotational No-Load ETF/SAF Conservative 0.57% -0.62%


Other Custodian Quantified Fund-Based

Market Leaders Strategic portfolios
Weekly returns YTD-March returns
Market Leaders Strategic Aggressive 1.80% 0.38%
Market Leaders Strategic Growth 1.70% -0.44%
Market Leaders Strategic Balanced 1.60% -1.32%
Market Leaders Strategic Moderate 1.19% -1.60%
Market Leaders Strategic Conservative 0.62% -0.49%

Market Leaders Strategic/Alternative SAF portfolios
Weekly returns YTD-March returns
Market Leaders Strategic/Alternative SAF Aggressive 1.66% 0.32%
Market Leaders Strategic/Alternative SAF Growth 1.58% -0.33%
Market Leaders Strategic/Alternative SAF Balanced 1.49% -1.04%
Market Leaders Strategic/Alternative SAF Moderate 1.17% -1.24%
Market Leaders Strategic/Alternative SAF Conservative 0.71% -0.38%

Dynamic Fund Profiles portfolios
Weekly returns YTD-March returns
Dynamic Fund Profiles Aggressive 1.22% 0.61%
Dynamic Fund Profiles Growth 1.12% 0.72%
Dynamic Fund Profiles Balanced 0.99% 1.09%
Dynamic Fund Profiles Moderate 0.87% 1.55%
Dynamic Fund Profiles Conservative 0.71% 2.17%



Other Custodian Fusion/Fusion Prime Portfolios

All Fusion portfolios were up for the week at Schwab. This has been the first week in at least five weeks that the higher beta, high growth, momentum-based styles have outperformed the market as a whole. Bucking the trend of the last five weeks, there was a perfect correlation between risk target and return, with the aggressive risk target performing the best (+3.81%), and the conservative risk target performing the worst (+0.99%). Fusion Aggressive was helped by its large exposure to leveraged NASDAQ 100 and S&P 500 funds. Conversely, Fusion Conservative lagged because of its relatively large allocation to money market, fixed-income, gold-related, and inverse small cap funds.


Fusion/Fusion Prime Portfolios
Weekly returns YTD-March returns
Fusion Aggressive 3.81% -7.02%
Fusion Growth 3.37% -6.73%
Fusion Balanced 2.54% -5.64%
Fusion Moderate 1.80% -3.72%
Fusion Conservative 0.99% -1.78%


  Underlying Allocations
   
FUSION/FUSION PRIME Conservative Allocation
1.2X Government Bond 20%
2X Dollar 14%
2X S&P 500 11%
Classic 24%
Managed Income Aggressive 12%
Political Seasonality 3%
Inverse Russell 2000 6%
Hedged Gold Bullion 5%
TVA Gold 5%

FUSION/FUSION PRIME Moderate Allocation
1.2X Government Bond 15%
2X Dollar 10%
2X S&P 500 21%
2X Emerging Markets 2%
Classic 20%
Managed Income Aggressive 9%
Political Seasonality 2%
2X NASDAQ 100 6%
Inverse Russell 2000 5%
Hedged Gold Bullion 5%
TVA Gold 5%

FUSION/FUSION PRIME Balanced Allocation
1.2X Government Bond 10%
2X Russell 2000 4%
2X Dollar 7%
2X S&P 500 29%
2X Emerging Markets 5%
Classic 15%
Managed Income Aggressive 6%
Political Seasonality 1%
2X NASDAQ 100 11%
Inverse Russell 2000 3%
Hedged Gold Bullion 5%
TVA Gold 5%

FUSION/FUSION PRIME Growth Allocation
1.2X Government Bond 4%
2X Russell 2000 6%
2X Dollar 3%
2X S&P 500 36%
2X Emerging Markets 8%
Classic 12%
Managed Income Aggressive 2%
2X NASDAQ 100 18%
Inverse Russell 2000 2%
Hedged Gold Bullion 5%
TVA Gold 5%
FUSION/FUSION PRIME Aggressive Allocation
2X Russell 2000 6%
2X S&P 500 36%
2X Emerging Markets 9%
Classic 7%
Systematic Advantage 3%
2X International Developed 8%
2X NASDAQ 100 21%
Hedged Gold Bullion 5%
TVA Gold 5%

 
Disclosures
     
  Flexible Plan Investments, Ltd. now offers managed account services for both PCRAs and individual accounts at our new custodian. For more information about our newest custodian contact our Sales Department at 800-347-3539 Ext. 2  
     


In My Opinion
What's Happening at Flexible Plan
Last Week in the Market
Strategy Performance
Gold
Quantified Funds
Diversified Bonds
Diversified Tactical Equity
Dynamic Fund Profiles
Faith Focused Investing
Fusion
Lifetime Evolution
Market Leaders
Other Custodians
Select Alternatives
Strategic Solutions


Disclosures


 
  April 22, 2014      
Top of page
  Select Alternatives

Select Alternatives rose 1.05% for the week. The strategy was helped the most by its 25% weighting in the Catalyst Strategic Insider Fund (STVAX), which was up 1.53% for the week. Also helping was the strategy’s exposure to the Stone Ridge U.S. Small Cap Variance Risk Premium Fund (VRSIX). The Gold Bullion Strategy Fund (QGLDX) was the only holding that was down on the week (-2.00%), but its weight was only 4% in the strategy.

Disclosures
     
  Select Alternatives combines the diversification and liquidity of alternative investments traditionally available only to hedge funds. Historically, these alternative asset classes have been non-correlated to the broad markets and seek to provide a portfolio both risk management and upside potential.  
     

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Select Alternatives
Strategic Solutions


Disclosures



 
  April 22, 2014      
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  Strategic Solutions

Last week most of the global equity markets advanced, positively impacting many equity-based strategies. Safe haven bond markets declined as capital moved to equity-oriented markets. The leading strategies for the week were Fusion Growth and Aggressive, which were up more than 3.00%. Hedged Gold Bullion (-1.41) and Systematic Long/Short Bond Trading (-2.20) were the laggards on the week. This range of performance from various strategies and asset classes is among the many reasons Flexible Plan stresses the importance of strategic diversification.

  Weekly returns
Fusion Aggressive 3.85%
Fusion Prime 32 3.85%
Fusion Prime 28 3.54%
Fusion Growth 3.32%
Fusion Prime 24 3.06%


Disclosures
     
  Drawing on dozens of different strategies, Strategic Solutions is available for taxable and tax-deferred accounts. Generally, one can combine different strategies in a single account allowing for strategic diversification, not just asset class diversification. Clients and their financial advisors can pick their own strategies ($5,000 per strategy), FPI will choose, monitor and reallocate strategies for you in FUSION ($25,000 minimum), or, for accounts over $100,000, FUSION Prime.  
     

Disclosures  

Past performance does not guarantee future results. The opportunity for profits carries with it the possibility of losses. A complete list of all of our recommendations over the last 12 months is available upon request. Evolution Asset Allocation rankings reflect only the price action of the funds in each family, rather than the indexes reported herein. Such rankings are shorter term and utilize diversification among different funds. Therefore, they may appear to conflict with the longer term, single asset readings of our market indicators. In fact, the differences merely reflect the contrasting objectives and time horizons of each. Index returns are provided for informational purposes only; they are not meant to be applied as benchmarks since the statistical risk and volatility of client portfolios may materially differ from the indexes displayed.

"Model Account" results for the identified investment management strategy(s) shown are time weighted geometrically linked returns.  Except where noted, statistics are taken from single strategy accounts and are representative of our largest mutual fund and variable annuity holdings. These returns reflect actual accounts and dates of Flexible Plan's buy and sell signals. If an account terminates during a period, an alternative single account is substituted. Selection of accounts to serve as "model accounts" is based on the longevity of the account and least number of additions and withdrawals. Accordingly, many of the single accounts serving as 'models' are titled in the name of Flexible Plan's President and controlling shareholder, a person related to Flexible Plan.

If single strategy account histories are unavailable, statistics applicable to such accounts are derived from the exchange history files of each strategy used. Actual buy-sell trading signals and pricing are used in conjunction with such files to create the applicable statistics for each model account. These exchange-history derived returns are believed representative of each strategy's actual results, but the results do not represent the actual experience of any client during the period. Therefore, these results may not reflect the impact that material economic and market factors might have had on the results. Nor do they reflect any problems of execution or pricing that may have been encountered in the actual implementation of the buy and sell signals shown in the exchange history files, the effect of which has not been determined, and may be indeterminable.

SUITABILITY PROFILES: For many strategies Adviser provides suitability based profiles with names such as, without limitation, Conservative, Moderate, Balanced, Growth and Aggressive or with numerical designations such as 25, 40, 60, 80, 100.  Clients should draw no conclusions from such titles.  Rather they are simply a way of designating the hierarchical ranking of Adviser's Profiles within a strategy.  They are not meant to imply any ranking within some universal risk measure or benchmark, nor are they equivalent to a Client's subjective concept of the term.

Enhancements have been made in our methodologies on numerous occasions, which are believed to have had a positive effect on returns. The amount is not precisely quantifiable, but as strategy actual buy and sell signals are used, to the extent described, the effect of these enhancements is reflected. Efforts to develop indicators are ongoing and may result in further changes. Dividends are reinvested.

Utilizing performance between selected dates may not be indicative of overall performance of a profile since the dates chosen by the operator of the program may have been selected to present optimum performance and may not be representative of investment performance of any profile during a different period. Inquiry for current results is always advised. Mutual fund or annuity results will vary based upon their volatility as they relate to the S&P 500 Index or other indices that may be shown.  Specific mutual funds, sub-accounts or indices may materially outperform or under perform these results. Various mutual funds or sub-accounts used in any model account may no longer be available due to the result of advisor's, sponsor's or fund advisor's periodic review, fund consolidations and/or exchange conditions imposed by the funds or annuity.

Reference to popular market indexes are included to demonstrate the market environment during the period shown and are not intended as "benchmarks" Index returns are after dividends. Since Index dividends are posted after the end of each month, they are retroactively prorated on a daily basis (which tends to understate returns if the end date range is inclusive of the current partial month). The investment program for the accounts included in the profiles includes trading and investment in securities in addition to those that may be included in the S&P 500. Such indexes may not be comparable to the identified investment strategies due to the differences between the indexes' and the strategies' objectives, diversification, represented industries, number and type of component investments, their volatility and the weight ascribed to them. No index is a directly tradable investment.

For all strategies, the maximum current management fee in effect is 2.6% annually. Fees are deducted quarterly, in arrears with pro-ration of partial periods. Strategic Solutions strategy(s) may include up to a 1.2% establishment fee at inception. All mutual fund fees and expenses are included to the extent they are reflected in net asset value; other fees may apply. If a front -end fund purchase is contemplated, any commission charged should be deducted. As individual tax rates vary, taxes have not been considered.

For the ETF Market Leaders Strategic Strategies, returns are presented net of approximate trading commissions of $860 annually (but prorated and applied quarterly) on a $150,000 account (minimum of $8.95 per trade with e-delivery of statements - see brochure for details). The trading commissions are the investor's responsibility.

Advisor retains the right to predicate certain of its strategies on trading signals furnished by non-affiliated firms. In each such instance, the non-affiliated firm is under contract to Adviser to provide, and in certain instances, implement all buy and sell directions for management of Client accounts in the associated Advisor strategies. And, as with all third parties, Flexible Plan by necessity relies on their information, data, and software provided, but whose reliability, while believed to be accurate, cannot be guaranteed and losses may result from reliance upon them. These are normal risks for which Flexible Plan takes no responsibility beyond use of reasonable care in its selection of the third party.

Advisors Preferred LLC ("AP"). Pursuant to a contract with AP, Flexible Plan Investments, acting in the capacity of a sub-adviser, provides investment advisory services for select equity, income, derivative and ETF Investments which Flexible Plan also may use in selected strategies regardless of the Investments described as being utilized elsewhere in this Brochure. If these Investments are used in Client's portfolio, since Adviser would receive a fee for its sub-adviser activities, Clients will receive a pro-rata credit on their billing. AP is a federally registered investment adviser and is the adviser of the Gold Bullion Strategy Fund, Gold Bullion Strategy Portfolio and the Quantified family of funds. Flexible Plan Investments, Ltd. serves as investment sub-adviser to The Gold Bullion Strategy Fund and the Quantified funds, distributed by Ceros Financial Services, Inc. (member FINRA). AP is the Funds' investment adviser and is a wholly-owned subsidiary of Ceros Financial Services, Inc. AP is compensated by the funds in its role as investment adviser to the funds on the basis of assets under management in the funds. You may obtain a Prospectus by calling Advisors Preferred LLC at (888) 572-8868 or writing Advisors Preferred, LLC 1445 Research Boulevard, Ste. 530, Rockville, MD 20850 or download the PDF from: www.goldbullionstrategyfund.com or www.quantifiedfunds.com.

An investor should consider the investment objectives, risks, charges and expenses of The Gold Bullion Strategy Fund before investing. This and other information can be found in the Fund's prospectus, which can be obtained by calling 1-855-650-7453. The prospectus should be read carefully prior to investing in The Gold Bullion Strategy Fund.

There is no guarantee that The Gold Bullion Strategy Fund will achieve its investment objectives.

Flexible Plan Investments, Ltd. serves as investment sub-advisor to The Gold Bullion Strategy Fund and the Quantified Funds, distributed by Ceros Financial Services, Inc. (member FINRA). Ceros Financial Services, Inc. and Flexible Plan Investments, Ltd. are not affiliated entities. Advisors Preferred, LLC is the Fund's investment adviser. Advisors Preferred, LLC is a wholly-owned subsidiary of Ceros Financial Services, Inc.

The principal risks of investing in The Gold Bullion Strategy Fund or the Quantified Funds are Risks of the Sub-advisor's Investment Strategy, Risks of Aggressive Investment Techniques, High Portfolio Turnover, Risk of Investing in Derivatives, Risks of Investing in ETFs, Risks of Investing in Other Investment Companies, Leverage Risk, Taxation Risk, Concentration Risk, Gold Risk, Wholly-owned Corporation Risk, Risk of Non-Diversification and interest rate risk. "Gold Risk" includes volatility, price fluctuations over short periods, risks associated with global monetary, economic, social and political conditions and developments, currency devaluation and revaluation and restrictions, trading and transactional restrictions.