Smart ETFs: Adaptive Strategies and 2023 Performance

At Quantlake, our mission is to demystify the investing landscape, making it accessible and successful for all. We use our expertise in data-driven analytics to develop diversified ETF portfolios. Following our previous post on the Classic ETF models, let's explore the Smart category in detail.

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Smart Portfolio Features:

• Diversified Assets: Our Smart portfolios range from 4 to 11 ETFs, covering various asset classes such as equities, bonds, and commodities. They provide a spectrum of style equity ETF options including large, medium, and small caps, growth and value stocks, sectors, and dividend-oriented ETFs.
• Adaptive Weighting: We review portfolio weights monthly, a more frequent approach than our Classic models. This flexibility allows us to swiftly adapt to evolving market conditions, maintaining a systematic approach that minimizes emotional and biased decision-making.

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Benchmarking Our Approach:

• SPDR S&P 500 ETF Trust (SPY): A mirror to the US stock market's pulse.
• iShares Core Growth Allocation ETF (AOR): A growth-focused diversified portfolio.
• iShares Core U.S. Aggregate Bond ETF (AGG): Representing the broad US investment-grade bond market.

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2023 Performance Highlights:

• Average Gain: 23.21%
• Performance Range: 8.1% to a robust 34.5%
• Benchmark Comparisons: AGG at 5.68%, AOR at 15.2%, and SPY at 26.1%
• Key Insight: In 2023, a year marked by market unpredictability, our Smart portfolios stood out for their resilience and adaptability. Achieving a top performance of 34.5%, these portfolios exemplify the efficacy of our algorithmic strategies in navigating a rapidly changing investment landscape.

Our Smart ETF portfolios not only weathered the storm but also outperformed traditional market strategies, underscoring the significance of algorithm-driven decision-making in today’s complex markets.

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Happy Long-Term Investing from the Quantlake Team!

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