The goal of Weatherstone Capital Managements Balanced Growth program is to provide long-term growth of capital from a portfolio of stocks and bonds that is diversified across four tactical investment strategies.

Each strategy determines a portion of the investment allocation and directs the allocation between stocks, bonds and cash. The strategies used are; 1) relative strength, which looks for the investment sector or style that has the highest probability of outperforming over the next several weeks or months; 2) seasonality, which looks at the impact of seasonal cash flows in and out of the financial markets; 3) coherent styles and sectors, this strategy looks for areas of the markets that have entered into long-term sustainable up trends that are generally not influenced by the direction of the overall financial markets; and 4) tactical money managers. This strategy evaluates and holds mutual funds that are managed in a strategic manner and have the potential to rapidly adjust their asset allocation in response to changing market conditions.

Under Normal market conditions 35% of the portfolio will be invested in bonds. The bond portion of the portfolio can be invested in government bonds, high yield bonds, money market funds or real estate funds if conditions warrant.
[easychart type=”pie” title=”ASSET ALLOCATION for Apr 2014″ groupnames=”Consumer Cyclical,Foreign Large Blend,Healthcare,High Yield Bond,Industrials,Intermediate-Term Bond,Large Cap Blend Stocks,Large Cap Value,Mid Cap Growth,Precious Metals,Cash” group1values=”2.13%” group2values=”2.49%” group3values=”2.94%” group4values=”19.30%” group5values=”5.79%” group6values=”35.10%” group7values=”3.92%” group8values=”5.09%” group9values=”8.38%” group10values=”1.24%” group11values=”13.62%” chartfadecolor=”FFFFFF”]

The Diversified Growth program seeks to provide long-term growth of capital from a portfolio that is typically invested 100% in stocks during normal market conditions, but because of the active monitoring of the program, has the ability to change the asset allocation in response to changing market conditions. It is typically diversified across four tactical investment strategies.

Each strategy determines a portion of the investment allocation and directs the allocation between stocks and the money market funds. The strategies used are; 1) relative strength, which looks for the investment sector or style that has the highest probability of outperforming over the next several weeks or months; 2) seasonality, which looks at the impact of seasonal cash flows in and out of the financial markets; 3) coherent styles and sectors, this strategy looks for areas of the markets that have entered into long-term sustainable up trends that are generally not influenced by the direction of the overall financial markets; and 4) tactical money managers. This strategy evaluates and holds mutual funds that are managed in a strategic manner and have the potential to rapidly adjust their asset allocation in response to changing market conditions.

The program is well suited for investors who wish to target the long-term growth rates generated by stocks, but with less volatility than is found in using a traditional buy-and-hold investment strategy.
[easychart type=”pie” title=”ASSET ALLOCATION for Apr 2014″ groupnames=”Consumer Cyclical,Foreign Large Blend,Healthcare,Industrials,Intermediate-Term Bond,Large Cap Blend Stocks,Large Cap Value,Mid Cap Growth,Precious Metals,Cash” group1values=”3.32%” group2values=”2.46%” group3values=”3.49%” group4values=”7.22%” group5values=”39.22%” group6values=”5.81%” group7values=”9.24%” group8values=”10.17%” group9values=”2.33%” group10values=”16.74%” chartfadecolor=”FFFFFF”]

The Global Multi-Asset program delivers tactically managed investments for clients utilizing Modern Portfolio Theory (MPT) as well as proprietary models that evaluate the risk/reward relationship and make adjustments to the asset allocation of the portfolio. Most individual investors have portfolios that lack in diversification. The basic tenet of MPT is that the proper use of asset allocation and diversification is an appropriate way for an investor to enhance the returns while reducing risk and volatility. While diversification does not ensure an account against loss, non-diversified portfolios often produce lower returns and almost always exhibit more risk and higher volatility than those that are fully diversified. The Global Multi-Asset program utilizes a very diverse array of investment classes available in the mutual fund or ETF format. This includes both US and International stocks. It will also invest in emerging market funds, real estate investment trusts (REITs), high quality US and International bonds, high-yield US bonds, emerging market bonds, treasury inflation protected bonds (TIPs), commodities, precious metals, absolute return strategies such as merger arbitrage, and money market instruments. The program uses risk management strategies which regularly monitors the performance of each asset class and the markets in general. Adjustments are periodically made to the portfolio in response to changing market conditions as asset classes become more or less attractive relative to each other. Asset classes may be overweighted, underweighted or moved fully to cash depending upon market conditions. It is a dynamic process with the objective of adding value over time by both improving returns and reducing risk.
[easychart type=”pie” title=”ASSET ALLOCATION for Apr 2014″ groupnames=”Bank Loan,Bonds Taxable,Commodities Broad Basket,Conservative Allocation,Equities Foreign,Equity Energy,Foreign Sm/mid Value,High Yield Bond,Intermediate Term Bond,Large Blend,Large Cap Value,Real Estate” group1values=”22.19%” group2values=”9.59%” group3values=”7.68%” group4values=”3.91%” group5values=”5.12%” group6values=”4.89%” group7values=”4.80%” group8values=”5.04%” group9values=”4.77%” group10values=”8.15%” group11values=”3.86%” group12values=”2.35%” chartfadecolor=”FFFFFF”]

The Focused Growth Program is a non-diversified investment strategy that invests in style and sector focused mutual funds that have the potential to outperform competing investments over an intermediate-term basis. Investments are chosen using two different screening strategies. The first strategy looks at intermediate-term relative strength analysis using a combination of neural network based genetic algorithms and quantitative relative strength and momentum rankings. The second strategy looks for styles or sectors that have entered a coherent bullish stage of price appreciation characterized by above-average returns with below-average volatility. Additional screening is done using various technical filters. This program will typically be fully invested in equities; however, during periods of market weakness, money market funds and bear funds may be utilized.

The objective of the Sector Rotation Program is to tactically alter equity exposure across 10 industry sectors, based upon quantitative models. The primary econometric, quantitative model evaluates factors such as the overall economy, fundamental variables that measure relative value of various equity markets versus bonds, risk metrics which are designed to capture the level of uncertainty in the markets, and technical factors such as momentum and market conviction metrics which are used to quantify the strength of market movements. When a sector model is on a “buy” 10% of the portfolio will be allocated to that sector. On a “sell” there is a 0% weighting to the sector and the money is allocated either to a money market fund or one of six bond asset classes.
[easychart type=”pie” title=”ASSET ALLOCATION for Apr 2014″ groupnames=”Emerging Market Bond,Emerging Markets High Yield Bond,Financial,High Yield Bond,Industrials,Intermediate Term Bond,Intermediate Term Government Bond,Short Term Bond,UltraShort Bond,Utilities,Cash,Consumer Defensive” group1values=”14.53″ group2values=”4.96″ group3values=”2.40″ group4values=”24.54″ group5values=”2.34″ group6values=”9.85″ group7values=”9.50″ group8values=”8.12″ group9values=”14.67″ group10values=”2.47″ group11values=”3.85″ group12values=”2.44″ chartfadecolor=”FFFFFF”]

The objective of the Country Rotation Program is to maximize opportunity with defined risk controls by trying to consistently invest in those countries around the world that have strong-risk-adjusted performance potential. The strategy assesses market conditions across 20 countries, including several emerging markets. It uses an econometric multifactor model based on economic, fundamental, risk and technical analysis that evaluates the risk-adjusted potential of investing in a country’s equity market versus fixed income. If the expected return per unit of risk for the country is less favorable than that of a fixed income alternative, the potential 5% allocation for each country is deployed to the actively managed fixed income portion of the portfolio.
[easychart type=”pie” title=”ASSET ALLOCATION for Apr 2014″ groupnames=”Emerging Market Bond,Emerging Markets High Yield Bond,Equility Foreign,High Yield Bond,Intermediate Term Bond,Intermediate Term Government Bond,Latin America Stock,Short Term Bond,UltraShort Bond,Cash” group1values=”12.21″ group2values=”4.34″ group3values=”15.77″ group4values=”19.70″ group5values=”8.00″ group6values=”7.43″ group7values=”4.78″ group8values=”8.41″ group9values=”14.60″ group10values=”4.76″ chartfadecolor=”FFFFFF”]