The World Country Top 4 Strategy is a momentum driven strategy that invests in the top four single country ETFs. It will add geographic diversity to your portfolio with significant non-U.S. equity exposure.

The strategy consists of four sub-strategies. Each sub-strategy invests in the best country ETF in a specific geographic area (i.e., Africa, Asia, Latin America, etc). These strategies are then combined to yield four country ETFs that come from different geographic segments, thus avoiding overconcentration. So even if one region is outperforming all the other areas, this strategy will still diversify among three additional top performing regions.

Like our other equity-based strategies, this strategy is hedged with a sub-strategy (HEDGE) that includes, amongst others, safe heaven assets like treasuries and gold.

Country ETFs:

- AFK Market Vectors Africa Index
- ASHR Deutsche X-Trackers CSI 300 China A Shares
- ECH iShares MSCI Chile Fund
- EGPT Market Vectors Egypt Index
- EIDO iShares MSCI Indonesia Index
- EIRL iShares MSCI Ireland Capped
- EIS iShares MSCI Israel
- ENZL iShares MSCI New Zealand Investable Market
- EPHE iShares MSCI Philippines
- EPI WisdomTree India Earnings Index
- EPOL iShares MSCI Poland Index
- EPU iShares MSCI Peru Index
- EWA iShares MSCI Australia Index Fund
- EWC iShares MSCI Canada Index Fund
- EWD iShares MSCI Sweden Index
- EWG iShares MSCI Germany Index
- EWH iShares MSCI Hong Kong Index Fund
- EWI iShares MSCI Italy Index
- EWJ iShares MSCI Japan Index Fund
- EWK iShares MSCI Belgium Index
- EWL iShares MSCI Switzerland
- EWM iShares MSCI Malaysia Index Fund
- EWN iShares MSCI Netherlands Index
- EWO iShares MSCI Austria Index
- EWP iShares MSCI Spain Index
- EWQ iShares MSCI France
- EWS iShares MSCI Singapore Index
- EWT iShares MSCI Taiwan Index Fund
- EWU iShares MSCI United Kingdom Index
- EWW iShares MSCI Mexico Index Fund
- EWY iShares MSCI South Korea Index Fund
- EWZ iShares MSCI Brazil Index Fund
- EZA iShares MSCI South Africa Index
- FM iShares MSCI Frontier Markets ETF
- FRN Guggenheim BNY Mellon Frontier Mkts
- FXI iShares FTSE China 25 Index Fund
- GAF SPDR S&P E.M. Middle East & Africa
- GULF WisdomTree Middle East Dividend Index
- GREK Global X FTSE Greece 20
- GXG Global X Interbolsa FTSE Colombia 20
- IDX Market Vectors Indonesia
- MCHI iShares MSCI China Index
- MES Market Vectors DJ Gulf States (GCC) Titans
- NORW Global X FTSE Norway 30 ETF
- QQQ PowerShares Nasdaq-100 Index
- RSX Market Vectors DAXglobal Russia
- THD iShares MSCI Thailand Index
- TUR iShares MSCI Turkey
- VNM Market Vectors Vietnam

'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.'

Applying this definition to our asset in some examples:- The total return, or performance over 5 years of World Top 4 Strategy is 103.7%, which is higher, thus better compared to the benchmark ACWI (68.1%) in the same period.
- Looking at total return, or increase in value in of 27.6% in the period of the last 3 years, we see it is relatively greater, thus better in comparison to ACWI (17.3%).

'The compound annual growth rate (CAGR) is a useful measure of growth over multiple time periods. It can be thought of as the growth rate that gets you from the initial investment value to the ending investment value if you assume that the investment has been compounding over the time period.'

Which means for our asset as example:- Looking at the annual return (CAGR) of 15.3% in the last 5 years of World Top 4 Strategy, we see it is relatively larger, thus better in comparison to the benchmark ACWI (11%)
- Compared with ACWI (5.5%) in the period of the last 3 years, the compounded annual growth rate (CAGR) of 8.5% is larger, thus better.

'Volatility is a rate at which the price of a security increases or decreases for a given set of returns. Volatility is measured by calculating the standard deviation of the annualized returns over a given period of time. It shows the range to which the price of a security may increase or decrease. Volatility measures the risk of a security. It is used in option pricing formula to gauge the fluctuations in the returns of the underlying assets. Volatility indicates the pricing behavior of the security and helps estimate the fluctuations that may happen in a short period of time.'

Which means for our asset as example:- Compared with the benchmark ACWI (19.9%) in the period of the last 5 years, the 30 days standard deviation of 8.2% of World Top 4 Strategy is lower, thus better.
- During the last 3 years, the historical 30 days volatility is 6.8%, which is lower, thus better than the value of 16.6% from the benchmark.

'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.'

Applying this definition to our asset in some examples:- The downside risk over 5 years of World Top 4 Strategy is 5.8%, which is smaller, thus better compared to the benchmark ACWI (14.4%) in the same period.
- Looking at downside risk in of 4.6% in the period of the last 3 years, we see it is relatively lower, thus better in comparison to ACWI (11.5%).

'The Sharpe ratio (also known as the Sharpe index, the Sharpe measure, and the reward-to-variability ratio) is a way to examine the performance of an investment by adjusting for its risk. The ratio measures the excess return (or risk premium) per unit of deviation in an investment asset or a trading strategy, typically referred to as risk, named after William F. Sharpe.'

Using this definition on our asset we see for example:- The risk / return profile (Sharpe) over 5 years of World Top 4 Strategy is 1.56, which is greater, thus better compared to the benchmark ACWI (0.42) in the same period.
- During the last 3 years, the risk / return profile (Sharpe) is 0.88, which is greater, thus better than the value of 0.18 from the benchmark.

'The Sortino ratio measures the risk-adjusted return of an investment asset, portfolio, or strategy. It is a modification of the Sharpe ratio but penalizes only those returns falling below a user-specified target or required rate of return, while the Sharpe ratio penalizes both upside and downside volatility equally. Though both ratios measure an investment's risk-adjusted return, they do so in significantly different ways that will frequently lead to differing conclusions as to the true nature of the investment's return-generating efficiency. The Sortino ratio is used as a way to compare the risk-adjusted performance of programs with differing risk and return profiles. In general, risk-adjusted returns seek to normalize the risk across programs and then see which has the higher return unit per risk.'

Which means for our asset as example:- Looking at the ratio of annual return and downside deviation of 2.22 in the last 5 years of World Top 4 Strategy, we see it is relatively higher, thus better in comparison to the benchmark ACWI (0.59)
- During the last 3 years, the excess return divided by the downside deviation is 1.29, which is greater, thus better than the value of 0.26 from the benchmark.

'The Ulcer Index is a technical indicator that measures downside risk, in terms of both the depth and duration of price declines. The index increases in value as the price moves farther away from a recent high and falls as the price rises to new highs. The indicator is usually calculated over a 14-day period, with the Ulcer Index showing the percentage drawdown a trader can expect from the high over that period. The greater the value of the Ulcer Index, the longer it takes for a stock to get back to the former high.'

Applying this definition to our asset in some examples:- Compared with the benchmark ACWI (9.93 ) in the period of the last 5 years, the Ulcer Ratio of 2.68 of World Top 4 Strategy is lower, thus better.
- Compared with ACWI (11 ) in the period of the last 3 years, the Ulcer Ratio of 2.91 is lower, thus better.

'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:- Looking at the maximum reduction from previous high of -14.6 days in the last 5 years of World Top 4 Strategy, we see it is relatively larger, thus better in comparison to the benchmark ACWI (-33.5 days)
- During the last 3 years, the maximum drop from peak to valley is -8.1 days, which is higher, thus better than the value of -26.4 days from the benchmark.

'The Maximum Drawdown Duration is an extension of the Maximum Drawdown. However, this metric does not explain the drawdown in dollars or percentages, rather in days, weeks, or months. It is the length of time the account was in the Max Drawdown. A Max Drawdown measures a retrenchment from when an equity curve reaches a new high. It’s the maximum an account lost during that retrenchment. This method is applied because a valley can’t be measured until a new high occurs. Once the new high is reached, the percentage change from the old high to the bottom of the largest trough is recorded.'

Applying this definition to our asset in some examples:- Looking at the maximum time in days below previous high water mark of 247 days in the last 5 years of World Top 4 Strategy, we see it is relatively lower, thus better in comparison to the benchmark ACWI (516 days)
- Looking at maximum days below previous high in of 247 days in the period of the last 3 years, we see it is relatively smaller, thus better in comparison to ACWI (516 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:- The average time in days below previous high water mark over 5 years of World Top 4 Strategy is 44 days, which is smaller, thus better compared to the benchmark ACWI (133 days) in the same period.
- Compared with ACWI (192 days) in the period of the last 3 years, the average days under water of 61 days is lower, thus better.

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 Top 4 Strategy are hypothetical and do not account for slippage, fees or taxes.
- Results may be based on backtesting, which has many inherent limitations, some of which are described in our Terms of Use.