Our most aggressive core strategy, Fund Upgrading is a “momentum” strategy premised on the observable phenomenon that recent past performance tends to persist. The strategy has you diversify your portfolio across five stock-fund “risk categories” (and, if your asset allocation calls for it, three bond-fund categories). You then buy the funds SMI objectively determines to be demonstrating the strongest current momentum, occasionally replacing lagging funds with those showing greater momentum. Fund Upgrading requires only monthly maintenance and has generated better long-term returns than the overall market.
This article explains the changes to put in place for the coming month.
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