FormulaFolios

Yes. If your client has an objection to a certain social sector or even a particular stock, they can be excluded inside of their allocation with relative ease.

Yes. Even though short-term capital gains rates will apply in non-qualified accounts, FormulaFolios are private accounts so there will be no embedded gains, as in the case of mutual funds. We can also employ particular strategies that are designed to be more tax sensitive and have a lower turnover ratio. Ultimately, our goal is to constantly outperform market averages on a risk adjusted return basis.

No, stop/losses are not used. When the research was being developed for our strategies, stop/losses were looked at as a possible tool. What we found is that it is nearly impossible to use them with any degree of accuracy and it increased the frequency of trades, while providing no real increase in return. Therefore, we use two elements to provide protection: an economic overlay, which we call Recession Probability Analytics (RPA), and position sizing elements, which are quantitatively programmed into a few of the strategies.

No. There are no ticket charges, per share fee charges, or additional trading fees. The price we give is inclusive for the money management portion, there will be separate charges for wire transfers or other services (please see fee agreement)

In theory it is possible that none of the stocks would qualify and we could sit 100% cash for a short duration of time, although, there is very, very small probability of this ever occurring. A more likely scenario is that we could hold ETF positions that would hedge our investments.

FormulaFolios are privately managed investment accounts powered by multi-factor quantitative investment models. By using a rules based, process driven model, emotions are removed from the investment process thus increasing the statistical probability of success. FormulaFolios are comprised of individual equities, exchange traded funds, mutual funds and cash equivalents. FormulaFolio Investments’ proprietary systematic mechanical approach to selecting positions is designed to only select positions with an above average probability of returns based on both fundamental and technical indicators. No outside leverage, or short selling is used. The principal objective of the portfolio is to reduce equity market risk and increase portfolio returns.

FormulaFolios can be liquidated within one day, providing markets are open.

There are 15 separate and unique investment methodologies used in the composition of FormulaFolios; thus reducing the possibility of model failure and increasing the stability of expected returns. The ultimate goal of FormulaFolios is to outperform market averages on a risk adjusted return basis.

Performance updates are issued every quarter, along with a full, in-depth Market Commentary providing insight into various markets, both foreign and domestic. You will be able to check the performance of any account 24/7 by accessing your account at formulafolios.com, or you can utilize our new Apple and Android applications designed for your smart phone or iPad.

FormulaFolios were created in late 2004 as the brainchild of Jason Wenk. Mr. Wenk was unsatisfied with the fact that nearly 80% of all money managers failed to outperform their benchmarks and often produced less than desirable risk adjusted returns. This in turn created a quandary for his clients; how were they going to preserve their assets regardless of the climate of the market? The research for a new investment strategy then commenced and has been an ongoing process for the last five years.

As a result, FormulaFolios is an Investment strategy unlike any other in the market today, and embodies the idea of being simple, yet sophisticated. Simple because of the concepts it is based on, yet sophisticated because of its advanced systematic mechanical approach to quantitative analysis.

Today, FormulaFolios continues its research with the same dedication to the preservation and creation of wealth for its clients. Mr. Wenk is still President, Chief Investment Strategist, and works directly to insure FormulaFolios continues to provide stability in unstable environments.