The World Country Asia strategy is a sub-strategy that picks the top country of the specified region. It is part of the World Top 4 investment strategy.

ASHR Deutsche X-Trackers CSI 300 China A Shares

DBKO Xtrackers MSCI South Korea Hdg Eq ETF

EIDO iShares MSCI Indonesia Index

EPHE iShares MSCI Philippines

EPI WisdomTree India Earnings Index

EWJ iShares MSCI Japan Index Fund

EWM iShares MSCI Malaysia Index Fund

EWS iShares MSCI Singapore Index

EWT iShares MSCI Taiwan Index Fund

EWY iShares MSCI South Korea Index Fund

EWZ iShares MSCI Brazil Index Fund

EZA iShares MSCI South Africa Index

FXI iShares FTSE China 25 Index Fund

IDX Market Vectors Indonesia

THD iShares MSCI Thailand Index

VNM Market Vectors Vietnam

From the HEDGE strategy:

GLD – SPDR Gold Shares

TLT– iShares Barclays Long-Term Treasuries (15-18yr)

Short Sectors:

SMN - ProShares UltraShort Basic Materials

ERY - Direxion Daily Energy Bear 3X ETF

SKF - ProShares UltraShort Financials

SIJ - ProShares UltraShort Industrial

REW - ProShares UltraShort Technology

RXD - ProShares UltraShort Health Car

SCC - ProShares UltraShort Consumer Service

SDP - ProShares UltraShort Utilities

SZK - ProShares UltraShort Consumer Goods

'Total return is the amount of value an investor earns from a security over a specific period, typically one year, when all distributions are reinvested. Total return is expressed as a percentage of the amount invested. For example, a total return of 20% means the security increased by 20% of its original value due to a price increase, distribution of dividends (if a stock), coupons (if a bond) or capital gains (if a fund). Total return is a strong measure of an investment’s overall performance.'

Which means for our asset as example:- Looking at the total return, or performance of 53.5% in the last 5 years of World Countries Asia, we see it is relatively lower, thus worse in comparison to the benchmark SPY (67.8%)
- During the last 3 years, the total return, or increase in value is 69.9%, which is greater, thus better than the value of 44.5% from the benchmark.

'The compound annual growth rate isn't a true return rate, but rather a representational figure. It is essentially a number that describes the rate at which an investment would have grown if it had grown the same rate every year and the profits were reinvested at the end of each year. In reality, this sort of performance is unlikely. However, CAGR can be used to smooth returns so that they may be more easily understood when compared to alternative investments.'

Using this definition on our asset we see for example:- Looking at the compounded annual growth rate (CAGR) of 9% in the last 5 years of World Countries Asia, we see it is relatively smaller, thus worse in comparison to the benchmark SPY (10.9%)
- Looking at compounded annual growth rate (CAGR) in of 19.3% in the period of the last 3 years, we see it is relatively greater, thus better in comparison to SPY (13.1%).

'In finance, volatility (symbol σ) is the degree of variation of a trading price series over time as measured by the standard deviation of logarithmic returns. Historic volatility measures a time series of past market prices. Implied volatility looks forward in time, being derived from the market price of a market-traded derivative (in particular, an option). Commonly, the higher the volatility, the riskier the security.'

Which means for our asset as example:- Compared with the benchmark SPY (21.4%) in the period of the last 5 years, the volatility of 18.2% of World Countries Asia is smaller, thus better.
- Looking at volatility in of 17.2% in the period of the last 3 years, we see it is relatively lower, thus better in comparison to SPY (18.8%).

'Risk measures typically quantify the downside risk, whereas the standard deviation (an example of a deviation risk measure) measures both the upside and downside risk. Specifically, downside risk in our definition is the semi-deviation, that is the standard deviation of all negative returns.'

Using this definition on our asset we see for example:- Compared with the benchmark SPY (15.4%) in the period of the last 5 years, the downside deviation of 13% of World Countries Asia is smaller, thus better.
- During the last 3 years, the downside deviation is 11.7%, which is lower, thus better than the value of 13.3% from the benchmark.

'The Sharpe ratio was developed by Nobel laureate William F. Sharpe, and is used to help investors understand the return of an investment compared to its risk. The ratio is the average return earned in excess of the risk-free rate per unit of volatility or total risk. Subtracting the risk-free rate from the mean return allows an investor to better isolate the profits associated with risk-taking activities. One intuition of this calculation is that a portfolio engaging in 'zero risk' investments, such as the purchase of U.S. Treasury bills (for which the expected return is the risk-free rate), has a Sharpe ratio of exactly zero. Generally, the greater the value of the Sharpe ratio, the more attractive the risk-adjusted return.'

Applying this definition to our asset in some examples:- Looking at the Sharpe Ratio of 0.36 in the last 5 years of World Countries Asia, we see it is relatively lower, thus worse in comparison to the benchmark SPY (0.39)
- Looking at Sharpe Ratio in of 0.98 in the period of the last 3 years, we see it is relatively larger, thus better in comparison to SPY (0.56).

'The Sortino ratio, a variation of the Sharpe ratio only factors in the downside, or negative volatility, rather than the total volatility used in calculating the Sharpe ratio. The theory behind the Sortino variation is that upside volatility is a plus for the investment, and it, therefore, should not be included in the risk calculation. Therefore, the Sortino ratio takes upside volatility out of the equation and uses only the downside standard deviation in its calculation instead of the total standard deviation that is used in calculating the Sharpe ratio.'

Using this definition on our asset we see for example:- Looking at the downside risk / excess return profile of 0.5 in the last 5 years of World Countries Asia, we see it is relatively smaller, thus worse in comparison to the benchmark SPY (0.55)
- Compared with SPY (0.79) in the period of the last 3 years, the ratio of annual return and downside deviation of 1.44 is greater, thus better.

'The ulcer index is a stock market risk measure or technical analysis indicator devised by Peter Martin in 1987, and published by him and Byron McCann in their 1989 book The Investors Guide to Fidelity Funds. It's designed as a measure of volatility, but only volatility in the downward direction, i.e. the amount of drawdown or retracement occurring over a period. Other volatility measures like standard deviation treat up and down movement equally, but a trader doesn't mind upward movement, it's the downside that causes stress and stomach ulcers that the index's name suggests.'

Using this definition on our asset we see for example:- Looking at the Ulcer Index of 12 in the last 5 years of World Countries Asia, we see it is relatively greater, thus worse in comparison to the benchmark SPY (9.46 )
- Compared with SPY (10 ) in the period of the last 3 years, the Downside risk index of 13 is higher, thus worse.

'Maximum drawdown is defined as the peak-to-trough decline of an investment during a specific period. It is usually quoted as a percentage of the peak value. The maximum drawdown can be calculated based on absolute returns, in order to identify strategies that suffer less during market downturns, such as low-volatility strategies. However, the maximum drawdown can also be calculated based on returns relative to a benchmark index, for identifying strategies that show steady outperformance over time.'

Which means for our asset as example:- The maximum drop from peak to valley over 5 years of World Countries Asia is -31 days, which is greater, thus better compared to the benchmark SPY (-33.7 days) in the same period.
- During the last 3 years, the maximum reduction from previous high is -29.3 days, which is lower, thus worse than the value of -24.5 days from the benchmark.

'The Drawdown Duration is the length of any peak to peak period, or the time between new equity highs. The Max Drawdown Duration is the worst (the maximum/longest) amount of time an investment has seen between peaks (equity highs) in days.'

Applying this definition to our asset in some examples:- Looking at the maximum days under water of 519 days in the last 5 years of World Countries Asia, we see it is relatively larger, thus worse in comparison to the benchmark SPY (352 days)
- Looking at maximum days below previous high in of 268 days in the period of the last 3 years, we see it is relatively smaller, thus better in comparison to SPY (352 days).

'The Drawdown Duration is the length of any peak to peak period, or the time between new equity highs. The Avg Drawdown Duration is the average amount of time an investment has seen between peaks (equity highs), or in other terms the average of time under water of all drawdowns. So in contrast to the Maximum duration it does not measure only one drawdown event but calculates the average of all.'

Applying this definition to our asset in some examples:- Compared with the benchmark SPY (78 days) in the period of the last 5 years, the average days below previous high of 156 days of World Countries Asia is higher, thus worse.
- Looking at average days below previous high in of 70 days in the period of the last 3 years, we see it is relatively smaller, thus better in comparison to SPY (102 days).

Historical returns have been extended using synthetic data.
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- Note that yearly returns do not equal the sum of monthly returns due to compounding.
- Performance results of World Countries Asia are hypothetical, do not account for slippage, fees or taxes, and are based on backtesting, which has many inherent limitations, some of which are described in our Terms of Use.