The Post-MPT Growth and Moderate Allocations underperformed its benchmarks by rising 1.38% and 1.04%, respectively, in the quarter.
Post-MPT Growth was up 7.17% over the past twelve months while Post-MPT Moderate rose by 7.33% over the same period. Both allocations underperformed their benchmarks, the S&P 500 and the 60/40 stock/bond index respectively. (60/40 = 60% S&P 500 and 40% Barclays US Aggregate Bond Index.)
With more than twelve years of real-time performance, Post-MPT Growth has outperformed the S&P 500 since its 2005 inception with less drawdown. Historically, Post-MPT Growth has outperformed equities in flat to negative markets due to the model’s ability to change its exposure within a universe of low correlated asset classes and flexibility to own more conservative asset classes when market conditions are unfavorable.
During the quarter, Post-MPT Growth and Moderate were positively impacted by their technology and financial holdings. Allocations to Treasury bonds negatively affected returns in both strategies.
Both models continue to be positioned for a slow growing economy. Treasury bonds and utilities are large positions in both allocations. Post-MPT Growth is also overweighted in financials while Post-MPT Moderate has an above-market technology position. Post-MPT Growth lowered utilities and raised technology weightings while Post-MPT Moderate positioning remained mainly unchanged during the quarter.