The Intercontinental Account

This portfolio is of great interest to risk-averse individuals, corporations and institutions — the model indicates over 80% of the return of the S&P 500 with about a third of the risk.

We developed a model that is 35% equities and 65% income securities, with specific parameters in each asset class and tested it using mutual funds in the proper proportions going back to 1990. The time period included two very challenging markets: 1994 with stocks slightly down and a plunging bond market, and 1995 to 2002, which saw the dot com bubble rise and burst.

We crafted two models: one for domestic and one for international clients. The domestic model’s result was a single down year, 1994, off just over 2%, and all the other years showing positive returns. The model’s average annual return is over 9.5% with a standard deviation of about 5.5%. The international model yields similar results.