Our High Yield Bull/Bear strategy was built on the premise that high yield bonds, when used in a tactical setting, can deliver solid returns with minimal downside risk.  To boost returns, the strategy can also short equities during downtrending markets. 

While the live results for that strategy have been solid over the past three years, we decided to create a long-only version of our High Yield Bull/Bear Strategy, where we stripped out the "Bear" part of the "Bull/Bear" to see what happens when the strategy is reconfigured for those looking for tactical long-only exposure.  What we found, using the same trade parameters we've used for three years live, was truly impressive.  

While the bulk of these results are hypothetical (the strategy went "live" on 11/1/2013), keep in mind we have been using the same long signals within our High Yield Bull/Bear Strategy since early 2011.  Be that as it may, after deducting a 2% annual fee on the backtested data to arrive at a realistic net, we are very pleased with the results. 

High Yield bonds offer a unique investment opportunity within the tactical strategy space.  You typically can get high single-digit results with minimal drawdowns and very low volatility.  Matter of fact, in our backtested data listed above, you don't even see a negative year.

As we said, Tactical High Yield strategies offer very strong, consistent results with minimal drawdowns.  Minimal meaning low single-digits.  Keep in mind, this backtested data covers 2000-2013.  That means two devastating -50% equity bear markets happened during this time period.  These kind of Risk/Return statistics are very hard to come by. 

With all of the uncertainty in the fixed income arena, carving out an allocation for Tactical High Yield makes sense. Please contact us to discuss the potential value that can be added to your client accounts. 

The performance results shown include the reinvestment of dividends and other earnings. Comparison of the Optimus Advisory Group Programs to any other indices is for illustrative purposes only and the volatility of the indices used for comparison may be materially different from the volatility of the Optimus Advisory Group Programs due to varying degrees of diversification and/or other factors. Different types of investments involve varying degrees of risk and there can be no assurance that any specific investment will be profitable. Optimus Advisory Group does not make any representation that the Optimus Advisory Group Programs will or are likely to achieve returns similar to those shown in the performance results in this presentation. Optimus Advisory Group reserves the right to trade different funds within their models.   

The historical S&P performance results (and those of all other indices and index funds used as proxies for indices) are provided exclusively for comparison purposes only, so as to provide general comparative information to assist an individual client or prospective client in determining whether the performance of the Optimus' portfolio meets, or continues to meet, his/her investment objective(s). It should not be assumed that any Optimus portfolio holdings will correspond directly to any such comparative index.    

Different types of investments and/or investment strategies involve varying levels of risk, and there can be no assurance that any specific investment or investment strategy (including the investment strategies devised or undertaken by Optimus Advisory Group) will be profitable for a client's or prospective client's portfolio. All performance results have been compiled solely by Optimus Advisory Group and have not been independently verified.   

The Optimus performance results do not reflect the impact of taxes.