iSectors Allocations are unique and offer multiple advantages to investors:
Exchange-Traded Funds (ETFs), open and closed end Mutual Funds, exchange-listed Business Development Companies (BDCs), listed Master Limited Partnerships (MLPs), or SEC registered funds. While our investment strategy doesn’t specifically exclude exchange-traded notes (ETNs), these are not typically in our models.
Click here for our article that explains why ETFs have lower fees than mutual funds.
iSectors allocations have been applied in investment accounts since 2005. As of April 2018, over $250 million is invested in iSectors allocations. iSectors, LLC is an affiliate of Sumnicht & Associates, LLC (Sumnicht) and, as such, iSectors and Sumnicht share certain employees’ services. Sumnicht is an SEC registered investment adviser located in Appleton, Wisconsin. iSectors became a separate Registered Investment Advisor in August, 2008. Sumnicht & Associates has provided clients with independent investment advice and wealth management services since 1988. The firm was founded by Vern Sumnicht, CEO, MBA, CFP®. Sumnicht & Associates is independent and is not affiliated with any bank, broker or asset management firm.
iSectors® implements a number of proprietary strategies which are intended to help investors increase their risk-adjusted return (the return generated by measuring how much risk is involved in producing that return). Our various series of models implement different methodologies in order to generate risk-adjusted returns. For example:
iSectors® Post-MPT Series implements a dynamic approach that allocates its investments to as many as nine different asset classes that have less correlation to each other than the traditional asset classes that are perhaps more commonly used for portfolio diversification. iSectors’ research has shown that this strategy offers more effective diversification and can lessen the impact of prolonged market declines. Of course, it should not be assumed that future performance of any specific investment product, including iSectors, will equal past performance.
iSectors® Tactical Series attempts to provide improved risk adjusted returns by rotating to cash when each respective model’s targeted asset classes appear to be headed into protracted declines. These models apply momentum-based algorithms to identify and time these decisions so that the process remains systematic and objective.
iSectors® Endowment Allocation seeks to provide superior risk-adjusted returns by blending liquid alternatives with traditional stock-bond portfolio. These liquid alternative investments include private equity, hedge strategies, and real assets, all in the form of registered securities such as ETFs, open-end mutual funds, closed-end funds, exchange-traded notes and business development companies (BDCs). The Endowment Allocation is based on the approach pioneered by large university endowment managers, who dedicate a greater percentage of the portfolio to alternative investments than most traditional endowment funds. Because alternative investments are typically less liquid than stocks and bonds, alternative investments often possess pricing inefficiencies that offer the potential for improved returns.
iSectors® Inflation Protection Allocation and Precious Metals Allocation offers investors two vehicles which may help hedge against the risks of inflation. Official government figures maintain that there doesn’t currently appear to be significant inflation in our economy. However, official government statistics typically don’t include food and energy costs, both of which are significant costs to most households. Thus, inflation tends to be understated. The Inflation Protection and Precious Metals Allocations have been designed to help investors prepare themselves and their portfolios for ongoing inflationary pressures.
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