Observations

Observations and Conclusions of the Enhanced Dynamic® Methodology

 

  • In the domestic equity market, a growth or value equity investment style has been favored (more profitable) during certain periods of a market cycle, versus the opposing equity style, which has lasted for extended periods.
  • Investment style dominance has typically prevailed across all capitalization sizes: large cap, mid cap and small cap.
  • Since 1978, versus the S&P 500 index, the Enhanced Dynamic® domestic equity investment methodology back-testing studies of the Wilshire large cap indexes, have achieved statically significant annualized excess returns, adjusted for volatility.
  • Since 1978, versus the S&P 500, the Enhanced Dynamic® domestic equity investment methodology back-testing studies of the Wilshire small cap indexes, have achieved statically significant annualized excess returns, adjusted for volatility.
  • In the domestic equity market, a large cap or small cap equity investment style has been favored (more profitable) during certain periods of a market cycle, versus the opposing equity capitalization size, which has lasted for extended periods.
  • Investment capitalization dominance [large cap versus small cap] has typically prevailed with both investment styles: growth and value.
  • Since 1978, versus the S&P 500 index, the Enhanced Dynamic® domestic equity investment methodology empirical studies, of the Wilshire growth indexes, have achieved statically significant annualized excess returns, adjusted for volatility.
  • Since 1978, versus the S&P 500 index, the Enhanced Dynamic® domestic equity investment methodology empirical studies, of the Wilshire value indexes, have achieved statically significant annualized excess returns, adjusted for volatility.
  • We seek to increase a portfolio’s overall equity returns, with equal or lower volatility than the equity market, by combining the results of equity style rotation and equity cap size rotation, when applied strategically (not tactically), over a full market cycle.
  • The Enhanced Dynamic® investment methodology can typically be incorporated within an existing domestic equity portfolio with minimal dislocation of current style adherent portfolio managers and investment structure, and without significant additional expense.
  • We are experienced in the application of the Enhanced Dynamic® methodology with independent style adherent – active equity managers; index funds; exchange traded funds (ETFs); collective trust funds; and mutual funds.
  • The depth or degree of style and cap size adherence of the investment management vehicles will be an important determinant in the success and benefit of the Enhanced Dynamic® methodology within a client portfolio.
  • Equity portfolios are expected to remain fully invested at all times. This is not a tactical market timing program.

 

 

disclosures