Club and Component Portfolios: Descriptions and Strategies

The allocations to each Component portfolio in a Club portfolio are tailored for different withdrawal and inflation scenarios. For retirement and endowment accounts, it is important to understand the impact of portfolio withdrawals on portfolio performance and inflation-adjusted portfolio performance. The withdrawal rate sets the initial withdrawal amount which is then increased based on the inflation rate. The inflation-adjusted portfolio value is the portfolio value corrected for the inflation rate. Optimize portfolio allocations for various withdrawal and inflation scenarios. Result: Achieve desired withdrawals while preserving portfolio value and managing downside risk!

The market conditions are quantified using a combination of volatility, price momentum of bonds relative to stocks, stock valuation relative to other asset classes, and the index of leading economic indicators.

• VTI_AGG: Consists of VTI and AGG. The allocation to AGG varies from 20% to 80% depending on market conditions.
• Blend_AGG: Consists of ten benchmark ETFs (SPY, RSP, IVE, VXF, VTI, VIG, VYM, VNQ, VEA, VWO), and AGG. The allocation to AGG varies from 20% to 80% depending on market conditions with equal dollar weighting for the benchmark ETFs.
• Income_AGG: Consists of eight benchmark ETFs (VIG, VYM, DVY, SDY, VNQ, LQD, PFF, DNL), and AGG. The allocation to AGG varies from 20% to 80% depending on market conditions with equal dollar weighting for the benchmark ETFs.
• Bond_AGG: Consists of two benchmark ETFs (LQD, BND), and AGG. The allocation to AGG varies from 20% to 80% depending on market conditions with equal dollar weighting for the benchmark ETFs.
• Secure: Intended to secure capital while generating modest growth through a combination of ETFs and their associated options.
• Options_Sectors: Intended to generate income from options strategies. 20% of the portfolio is allocated to Sector options and the balance is allocated to Cash.
• Options_Indices: Intended to generate income from options strategies. 20% of the portfolio is allocated to Index options and the balance is allocated to Cash.
• TurboGrowth: 20% of the portfolio is allocated to Index options and the balance is allocated to VTI_AGG.
• TurboBlend: 20% of the portfolio is allocated to Index options and the balance is allocated to Blend_AGG.
• TurboIncome: 20% of the portfolio is allocated to Index options and the balance is allocated to Income_AGG.
• TurboSecure: 20% of the portfolio is allocated to Index options and the balance is allocated to Secure.
• TurboBond: 20% of the portfolio is allocated to Index options and the balance is allocated to Bond_AGG.
• BPS_Classic, BPS_Plus, BPS_Alpha, BPS_Ultra: Intended to generate income from algorithmic options strategies. 75% of the portfolio is allocated to Bull Put Spreads and the balance is allocated to Cash.
• BCS_Classic, BCS_Plus, BCS_Alpha, BCS_Ultra: Intended to generate income from algorithmic options strategies. 75% of the portfolio is allocated to Bear Call Spreads and the balance is allocated to Cash.
• IC_Classic, IC_Plus, IC_Alpha, IC_Ultra: Intended to generate income from algorithmic options strategies. 75% of the portfolio is allocated to Iron Condors and the balance is allocated to Cash with all Cash in an interest-bearing account.