In the backtesting that I have done with my ETF system, it experienced a maximum drawdown (weekly) of around 15% so I expect a drawdown of 15% to occur at any time. The current drawdown is 11.8% and it certainly isn’t pleasant to go through. That said, I have been trading my system knowing that this would happen. Even with the drawdown, my system has a CAGR that is 6.0% higher than the 60/40 model and it has a much lower Ulcer Index.
My system’s current ETF allocations are provided below.
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