performance #s not matching – what am I missing?

[James – East of the Suez]

Hi Logical Invest team,

How are you? I am a new subscriber and I have a question. In your Jan 2020 letter you list out the 2019 performances as follows:

https://logical-invest.com/the-logical-invest-newsletter-for-january-2020/
Leveraged UIS +80.5%
MYRS +54.8%
US Sect +13%
etc

But when I look at each strategy’s page where it lists tables of performance for 2019 there is a notable difference:
Leveraged UIS +54.6%
MYRS +52.2%
US Sect +19.5%
etc

Sizeable differences that are both better/ worse than listed. Could you help me understand which is more accurate and why the difference please?

[Frank1 Grossmann]

For 2020 we did make some changes to the strategies. The most important was that we changed the hedging strategy to invest always in 2 instead of one ETF. Now as this strategy is a part of most of our strategies it will change the backtested performance which you see in the charts. The real performance reported is correct. The 3x leveraged strategy was also changed to reduce risk/volatility. In the backtest this reduced the last year performance from real 80% to backtested 50%, however over 10-20 years the risk weighted return is better and I think that this change was already helping now during the Corona crisis.
We also had smaller strategy changes like two sector discontinued ETFs. This makes that in the backtest these will also not show up anymore.

[James – East of the Suez]

Hi Frank, that makes sense. Thanks for the response. James

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