Cornerstone Income II

A strategy for investors seeking diversified income and protection of capital.

Strategy Description

Designed to provide income, this model actually blends four different strategies and applies our Downside Risk Protector®

This strategy is a multi-asset class income model that invests in a wide range of cash, fixed interest, and dividend-focused ETFs.

Included in the analysis are U.S. Treasuries, mortgage-backed securities, investment-grade and high-yield corporate bonds, emerging market bonds, REITs, preferred stocks, and dividend stocks.   

The model is rebalanced monthly.

Definitions

Sharpe Ratio – the average return earned in excess of the risk-free rate.  A higher Sharpe Ration is better

Risk-Free Rate – represents the interest an investor would expect from an absolutely risk-free investment over a specified period of time.

Sortino Ratio – another measure of risk that takes into account the downside deviation of the asset.  A higher Sortino Ratio is better.

What is Drawdown?

Drawdown is the measure from the highest high to the lowest low or peak to trough during a specific time period.  It is an important measurement of risk.  A larger drawdown requires a more significant increase in the security to recover.

Volatility measures the change in the price of an investment.  The higher the volatility, the higher the difference between the high and the low of an investment’s price.

The 12 Month Rolling ROR is the compound rate of return for the last 12 months.  The rate of return is the gain or loss on an investment over a specified time period, expressed as a percentage of the investment’s cost.