Performance

EAA Lifestyle Portfolios

Performance through September 30, 2018

*Past performance is no guarantee of future results.
** performance doesn't include management fees

 

The performance graph shows a time-weighted return of the aggregate performance of all the securities held in the specified Account. Any new securities begin contributing to performance the day they were bought in the model and any securities that were sold cease contributing to performance the day theye were sold.

 

The performance numbers are not annualized returns. Instead, they are the returns during the chosen period, and they do not include fees since each account subscribing to a model may be given different fees based on the asset size of the account. 

 

We make reasonable attempts to prepare the performance information we provide in a manner consistent with basic performance reporting methodology. Performance reports are not audited, and may contain errors, exhibit anomalies under certain circumstances and conditions, or be assembled from historical, not real time, pricing information.

 

Past performance is no guarantee of future results. Performance data quoted herein represents past performance and is not indicative of future results. The investment return and principal value of an investment will fluctuate so that your investment, when redeemed, may be worth more or less than their original value. Current performance may be lower or higher than the performance data provided.

 

We use the Mid-Weighted Dietz Method.

The Mid-Weighted Dietz Method is a time-weighted return, which is most useful for comparing performance to a benchmark. Time-weighted returns remove the impact of cash and security movement into or out of a Model in order to capture the performance of the strategy rather than the timing and size of the cash and security movement. Consequently, these returns are not a measure of the actual profit or loss, or actual cash return of your portfolio or account.

 

The Mid-Weighted Dietz Method Without Fees:

Return(R) = (EMV + EA - (BMV + BA) -CF)

BMV + BA + (CF * 0.5)

EMV = Ending Market Value. This is the market value of your portfolio at the end of the period to be tested.

EA = Ending Accrual. This is the total amount of interest and/or dividends that have been accrued at the end of the period and have not yet been paid out to the portfolio.

BMV = Beginning Market Value. This is the market value of your portfolio at the beginning of the period to be tested.

BA = Beginning Accrual. This is the total amount of interest and/or dividends that have been accrued at the beginning of the period and have not yet been paid out to the portfolio.

CF = Total Cash Flows During the Period. Inflows of cash are treated as a positive number, while outflows are treated as a negative number.

R = Total Return for the Day. After the Mid-Weighted Dietz Calculation, this number is then used in the Unit Value calculation.

 

Dividends and other distributions, such as capital gains and interest, are included in performance as of the ex-date (date that new buyers are NOT entitled to the dividend), when available from our data vendor. Accrual information that is not available until payment date will trigger a recalculation of the performance back to the ex-date of the transaction to provide accurate returns.

 

Security transfers into or out of the model are valued at their previous closing price multiplied by the number of shares moved, for the purpose of calculating the performance.

 

Flows at the Folio level may be caused by trade or transfer activity, corporate actions, distributions such as dividends, or fees. For example, a dividend paid into a Folio model will move out of the Folio and into cash the day it is paid. Flows at the Account level are due to deposits, withdrawals, transfers, or fees.

 

At launch, each Folio has a hypothetical market value, which then changes over time based on the changing value of the underlying holdings. Corporate actions such as dividends, splits, spin-offs, etc., are processed in the same fashion as for funded accounts, with hypothetical money and shares exchanged rather than real dollars or shares. Corporate actions are not validated or audited, which may result in errors in the performance results presented. Cash distributions (i.e., dividends, capital gains, returns of capital) earned in an unfunded model are automatically reinvested into the securities that paid them using the security close price of the date paid.

When unfunded models are rebalanced, buys and sells are calculated to return the model to its target weights—these hypothetical transactions assume a full execution of the shares needed at closing prices or 15 minute delayed prices on the day of rebalance, depending on the time of the update. When the buys and sells cannot be offset exactly the resulting cash difference is hypothetically invested into FDIC.CASH—the symbol for Folio’s cash product. In most cases, this cash investment is a negligible portion of the unfunded Folio and will be hypothetically invested in the target model holdings (if possible) in the next rebalance.

 

The 3- and 5-Year RTG returns displayed on our site are annualized. We calculate annualized returns using the Compound Annual Growth Rate (CAGR). This calculation will smooth the Total Return of the period into a steady annual growth rate.

 

For example, if an RTG gained 30% in the first year and lost 10% in the second year then the total return for the 2 year period is 17% (i.e. (1 + 0.30) × (1 - 0.1) = 1.17 -1 = 17%). The CAGR will smooth this return to an annual return of 8.17% a year. Please see the Compounded Annual Growth Rate calculation below.

CAGR =    

( Ending Value )

Beginning Value

( 1 )

# of years

– 1

 

Model performance never constitutes a composite for purposes of GIPS reporting.

Unfunded model performance is only indicative of values and not real values for marketing purposes. To track the actual performance of a model, you should subscribe to it in a funded account.

Model performance deviates from actual client performance. Some of the common reasons include:

Different execution prices – model trades execute immediately while client trades execute in windows.

Previous day pricing – mutual funds in models are executed at the previous day NAV while client mutual fund trades are executed at the trade date NAV. Model equity trades placed outside of market hours execute at the previous closing price.

Frequent rebalances – models that are rebalanced frequently will deviate more quickly since different execution prices will have a greater impact.

Missed syncs – model holdings will differ from client holdings if the model is modified but not synced or if a particular client does not fully sync to the model weights.

 

Model folio returns are calculated using the same methodology as funded folios–the Mid-Weighted Dietz Method. At launch, each model has a hypothetical market value, which then changes over time based on the changing value of the underlying holdings.

 

The more frequent an unfunded Model is rebalanced the faster customer performance will deviate from a funded account performance. 

Funded accounts do not update at the same time the model is calculated for rebalanc. This might be reasons for funded account performance to differ from reported performance. Clients may choose to customize their account y adding or removing securities or changing the weights for the securities from the weights used by the model. If there is a difference in holdings between the Model and the client account then performance will differ.

 

Corporate actions. Clients may choose to participate in certain voluntary corporate actions (such as a Rights Issue) that will result in different holdings than those in the model. In addition, the client and Model holdings may be entitled to different corporate actions depending on the purchase date.

 

Dividend reinvestment. Clients may choose not to reinvest dividends for many reasons including not having a large enough balance in an account to warrant a dividend reinvestment.

 

Like all investing, investing in These models involves risk, including the risk that you may suffer the loss of your investment. We present this performance for informational purposes only. This document should not be regarded as an offer to sell or as a solicitation of an offer to buy a model.