Equity Investment Rotation (EIR) is utilized in both Enhanced Investing and DRIV Portfolio Strategy. EIR identifies ongoing style and capitalization size trends in the equity marketplace.
History...
EIR is a proprietary and fully quantitative signal generating methodology. It utilizes historical financial market data to generate Overperform / Underperform signals for style (growth vs. value) and capitalization size (large cap vs. small cap) holdings.
The EIR methodology was created for use in investment consulting practices in 1990, implemented in a $80 million managed retirement plan first in 1997, and quantitatively verified by the University of Chicago first in 2000.
Enhanced Investment Partners, LLC was formed to develop applications for the EIR methodology outside of the investment consulting marketplace and independent of securities firms.
Concept...
Throughout a market cycle, there are times when growth holdings outperform value holdings; and there are also times when value outperforms growth. The same applies to small cap and large cap holdings.
EIR identifies these trends and indicates when it is time to shift assets away from the underperforming style or cap size and into the emerging outperforming style or cap size.