adaptivwealth.com: sign up now for free trade alerts, other features

www.adaptivwealth.com

Sign up now before the month’s end: free monthly trade email alerts, both position entry and position exit reminders, have been implemented. The emails are sent out automatically by the backend a day before entry or exit. Positions are exited on the last trading day of every month; new positions are entered on the first trading day of the new month.

Note: the historical performance results on adaptivwealth are based on using market on close orders, an order type that allows you to buy/sell stocks right as the market closes.

Other features include the ability to view the adaptive Minimum Variance Portfolio’s historical allocations. One can see the benefits of being dynamic (vs. static, such as wealthfront.com or betterment.com) during the last few months of 2007, going into 2008: the MVP during this time period was around 80% in US intermediate term bonds (IEF), which largely protected the portfolio from the precipitous losses experienced by the stock market in the next year.

The MVP vs. VTI performance table (shown below, or when you mouse over the performance time series chart on the main adaptivwealth page) also show the benefits of an adaptive/dynamic allocation model.

mvp_vti_performance

The Minimum Variance Portfolio has a comparable compound annualized growth rate (since June 2006, when the ETFs it uses came online) to that of VTI, the Vanguard Total Stock Market ETF, a proxy for the overall US stock market. The MVP has a much lower maximum drawdown (-16.5% compared to VTI’s -55%), and almost double the Sharpe Ratio (0.62 vs. 0.35): in essence, it seems that the adaptive Minimum Variance Portfolio achieves stock-market like returns over the long-run with much lower volatility than the stock market.