iQ Income ETF Risk On Risk Off Model
IMPORTANT! In any given 3-month period, the iQ Income ETF Risk On Risk Off Model can be heavily allocated to money market / equivalents.
INVESTMENT OBJECTIVE
The iQ Income ETF Risk On Risk Off Model seeks to select top-performing bond ETFs using a rules-based strategy, while managing risks related to market fluctuations and interest rates.
RULES-BASED PROCESS
The iQ Income ETF Risk On Risk Off Model selects the five bond ETFs by utilizing the following time-tested and rules-based strategy.
Begin with a starting universe of all domestically-traded bond exchange-traded funds
Sort by 8-month exponential price momentum and select the top twenty-five
Sort the remaining ETFs based on a multi-factor ranking system that consists of current yield, long-term relative strength index (RSI), and long-term stochastic indicator.
As a hedge, move to 100% money market position based on the 14-day Stochastic Indicator level for domestic bond indices.
Potential Benefits of the iQ Income ETF Risk On Risk Off Model.
The iQ Income ETF Risk On Risk Off Model offers the following potential benefits:
Systematic Selection: The model uses a rules-based approach to choose bond ETFs, ensuring a disciplined and objective selection process that reduces emotional decision-making.
Focus on Top Performers: By sorting bond ETFs based on 8-month exponential price momentum and further refining the selection with a multi-factor ranking system, the model targets funds that are more likely to perform well, potentially enhancing returns.
Comprehensive Analysis: The multi-factor ranking system evaluates current yield, relative strength index (RSI), and stochastic indicators, providing a thorough analysis that considers multiple aspects of each ETF’s performance.
Risk Management: The model includes a hedge mechanism by moving to a 100% money market position based on the 14-day Stochastic Indicator level for domestic bond indices, which helps protect against market downturns and interest rate fluctuations.
Adaptive Strategy: By continuously monitoring and adjusting based on market conditions and indicators, the model adapts to changes, aiming to optimize the portfolio's performance across different market environments.
The iQ Income ETF Risk On Risk Off Model is subject to market, interest rate, and credit risks, with no guarantee that past performance metrics or hedging strategies will accurately predict future results or effectively mitigate market downturns.