This is another variation of the Market Rewind Rotation model using preferred, dividend and bond based ETFs to (hypothetically) produce a risk management model superior to our Lazy Man (higher beta) model. The model tracks the SPY closely and does produce a significant trading edge although the max drawdown is (surprise!!!!) greater than the Lazy Man model (as is the recovery period). The other focus of my attention is the continuum of RS Rankings….previously #1 DVY was also #1 last week. Ditto for all the ranks. This was not the case with the Lazy Man model profiled Wednesday and suggests the slow momentum of RS change relative to the Lazy Man portfolio. Conclusion….the Thinking Lazy Man would do well to consider capital deployment among a blend of non-correlated Rotation Models to minimize risk and insure maximum equity curve correlation.
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