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Investment Strategy
Trend Plus
Strategy Summary
TREND PLUS is a rules-based trend following strategy that our clients utilize across their whole portfolio or in combination with other strategy allocations. The strategy is designed to measure the strength of the overall trend in U.S. equity markets and deploy capital during uptrends to equity Exchange Traded Funds (ETFs) accordingly. When up trending markets are not detected, this tactical strategy is designed to turn defensive, moving into ETFs that have historically performed well during equity market downturns.
Strategy Performance, net of fees (Q3 2024)
Inception date January 1, 2017.
Annualized Returns
Cumulative Returns (since inception) | |
|---|---|
TREND PLUS | 142.2% |
Benchmark 60/40 | 107.4% |
S&P 500® TR | 194.7% |
Worst Calendar Year | |
|---|---|
TREND PLUS | (9.9%) 2022 |
Benchmark 60/40 | (15.9%) 2022 |
S&P 500® TR | (18.1%) 2022 |
Max Drawdown | |
|---|---|
TREND PLUS | (15.2%) Apr. 2018 |
Benchmark 60/40 | (20.1%) Sep. 2022 |
S&P 500® TR | (23.9%) Sep. 2022 |
Growth of $100,000
12/31/2016 - 9/30/2024
Annualized Volatility
Strategy Goals
Risk Management
Inception date of January 1, 2017. All returns are presented net of fees.
MSCM is an SEC Registered Investment Adviser. Registration does not imply a certain level of skill or training. Information pertaining to MSCM’s advisory operation, services, and fees is set forth in MSCM’s current Form ADV Part 2 brochure, a copy of which is available upon request or at www.adviserinfo.sec.gov or www.mscm.net.
The performance track record has been examined for accuracy by a CPA at Alpha Performance Verification Services, an independent third-party performance verification firm. Verification reports available upon request. The performance returns shown are calculated using a representative account in the strategy.
Past performance is not necessarily indicative of future performance. The TREND PLUS strategy was developed with the benefits of hindsight on the performance of financial instruments and markets, specifically the S&P 500 and Nasdaq Composite indices over historical periods. Future markets may behave differently than past markets and there can be no assurance that the TREND PLUS strategy will be profitable or that clients will not lose money.
Performance data for TREND PLUS is calculated and maintained by MSCM. The charts and graphs herein are presented for informational purposes only and should not be relied on to predict future movements of the market or for guidance on when to invest. Nothing in this presentation is intended to be relied on as investment, legal, or tax advice.
The performance results are net of a 1% annual management fee, applied 1/12th of 1% (0.083%) each month. Fees and expenses vary based on custodial relationships, trading costs, management fees, and other factors. Brokerage commissions and other expenses and taxes are not considered in the performance results. If all expenses had been considered, the performance results would have been lower.
There can be no assurance that an investment mix will lead to the expected results shown or perform in any predictable manner. It should not be assumed that investors will experience returns in the future, if any, comparable to those shown, or that any or all of MSCM’s clients experienced such returns.
No representation is being made that any account will or is likely to achieve results similar to those shown. Individual client results could significantly differ from the performance results being presented. Differences in account size, risk tolerance, timing of transactions and market conditions prevailing at the time of investment could lead to different results, and clients could potentially lose money.
The Standard & Poor’s 500 Index® (“S&P 500®”) is a broad-based index used for illustrative purposes only. The S&P 500® is shown because it is well known and easily recognized by investors. The S&P 500® is considered to be generally representative of the U.S. stock market as a whole. The index is not actively managed and it is not possible to invest directly in the index. The performance of client accounts using TREND PLUS can be more volatile at times and may not be comparable to the performance of the S&P 500® or any other index. S&P 500® returns are inclusive of dividends and thus reflect the total return (TR) to investors. Index returns are not net of advisory fees. Index data provided from Y Charts is not separately verified and assumed to be accurate.
The Benchmark 60/40 Index is calculated by Y Charts and is used for illustrative purposes only. A 60/40 portfolio (60% stocks and 40% bonds) represents a traditional investment allocation for U.S. investors. The Benchmark 60/40 is a blended index comprised of a 60% allocation to the S&P 500® Index and a 40% allocation to the Bloomberg Aggregate U.S. Bond Index (a broad-based fixed income index considered to be representative of the U.S. fixed income market). Index returns are inclusive of dividends and thus reflect the total return (TR) to investors. Index returns are not net of advisory fees. Index data provided from Y Charts is not separately verified and assumed to be accurate.
Annualized volatility, a common measure of risk, is the standard deviation of monthly returns, annualized.
Maximum Drawdown reflects maximum peak-to-trough decline in an investment, security, or index over a specific time period, as measured by the difference in the highest value during the time period and the subsequent lowest value during the time period.
contact
Address: 4701 W Lovers Lane, Dallas, TX, 75209
Phone: (214) 922-9200
© 2024 McElhenny Sheffield Capital Management (MSCM). All Rights Reserved. The content of this website is for general, informational purposes. Nothing contained on this website should be construed as an offer to sell or the solicitation of any offer to buy any security or other financial instrument or product offered or managed by MSCM or any other issuer or company. The provision of this information does not constitute the rendering of investment, consulting, legal, accounting, tax, or other advice or services. Information on this website should not be the basis of or be relied upon for making business, investment or other decisions or used as a substitute for consultation with professional advisors, nor should it be construed as advice, endorsement or recommendation. Special Notice to Non-U.S. Investors: Each of the investment products and services referred to on this website is intended to be made available to U.S. residents. This website shall not be considered a solicitation or offering for any investment product or service to any person in any jurisdiction where such solicitation or offer would be unlawful.
Investing involves risk. Principal loss is possible.
There can be no assurance that an investment mix will lead to the expected results shown or perform in any predictable manner. It should not be assumed that investors will experience returns in the future, if any, comparable to those shown, or that any or all of MSCM’s clients experienced such returns. No representation is being made that any account will or is likely to achieve results similar to those shown. Individual client results could significantly differ from the performance results being presented. Differences in account size, risk tolerance, timing of transactions and market conditions prevailing at the time of investment could lead to different results, and clients could potentially lose money.
If an indicator or stop levels fail to detect significant downturns in the market, the strategies will continue to be exposed to underlying positions that could potentially lose value during such downward periods. Similarly, if the indicators fail to timely identify a reversal of a downward trending market, the strategies will continue to be exposed to defensive ETFs at a time when there is significant appreciation in the equity markets. Either scenario could result in a strategy underperforming other investments that do not employ these strategies. There can be no guarantee our strategies will correctly or timely identify the industries, sectors, or asset classes that will outperform during a given quarter or that the strategies will correctly or timely identify market trends.
The strategies invest in other ETFs which will result in higher and duplicative expenses. If the strategy invests in U.S. Dollar ETFs, changes in currency exchange rates and relative value of non-U.S. currencies will affect the value of the investment. Investments in fixed income securities typically decrease in value when interest rates rise. If interest rates fall, certain obligations could be paid off more quickly and the proceeds invested in securities with lower yields. Changes in an issuer’s credit rating or the market’s perception of an issuer’s creditworthiness could also affect the value of an investment in an issuer.
Investing in ETFs are subject to risks that the market price of the shares could trade at a discount to its net asset value (“NAV”), an active secondary trading market could potentially not develop or be maintained, or trading could be halted by the exchange in which they trade, which could impact our ability to sell shares of an ETF.