Back in 2017, I posted the results of a couple alternative strategies using the ETF components of the HBPP. A lively discussion ensued with a variety of supportive and otherwise comments.
Today I am sharing the results of another alternative strategy. Using VTI, TLT and GLD ETFs, this strategy weighs the "modified 63-day returns" of the three ETFs on four rebalance dates - April 1, July 1, October 1 and January 1 (or the first trading day thereafter in the case of a weekend or holiday).
I say "modified 63-day returns" because the calculation is Share price today / Share price 63-days ago / Share price 63 days ago. This calculation overcomes instances where the 63-day return is negative.
The strategy starts on January 2, 2006 because not all of the ETFs were available prior to mid-2005. Here are the results:
Year Return CAGR
2020 YTD 10.09% 10.17%
2019 19.41%
2018 -2.15%
2017 14.40%
2016 8.76%
2015 -4.08%
2014 13.52%
2013 4.02%
2012 10.59%
2011 15.91%
2010 19.20%
2009 16.01%
2008 -2.68%
2007 14.95%
2006 13.28%
Annual Returns
1-year 19.41%
3-year 10.15%
5-year 6.88%
7-year 7.39%
10-year 9.67%
14-year 9.79%
Max Drawdown
-20.71% occurring on Nov.12, 2008
My purpose in sharing these results is to demonstrate that there are ways to improve upon the traditional HBPP results while still embracing its asset components. Now, as back in 2017, I purposely exclude SHY as interest rates are historically low and I accept the risk of excluding this asset in search of better returns.
My data was pulled from Yahoo Finance and the strategy is modeled in Excel. Send me a private message if you would like a copy for review and comment.
Thanks.
Alternative HBPP Strategy
Moderator: Global Moderator