Managed Accounts
Potomac offers four managed account investment strategies that investors may select from. These strategies range from conservative to aggressive.
- All assets are held at our custodian, Fidelity Investments
- $50,000 account minimum
- A separate account is needed to employ multiple strategies
Core Strategies: Typically 80-90% of total portfolio
Income Plus
Income Plus
Objective
This strategy is designed to provide a stable long-term total return from current income and consistent capital appreciation with a goal of achieving an absolute return under all market conditions by participating primarily in U.S. and international fixed income, market neutral and specialty investments.
Strategy Highlights
| Investment Objective: | Conservative |
| Account Minimum: | $50,000 |
| Investment Custodian: | Fidelity Investments |
| Strategy Inception Date: | 01/01/2009 |
Description
The Income Plus strategy is actively allocated across fixed income, market neutral and specialty mutual funds that demonstrate very low volatility and superior risk adjusted returns. The core investments in the Income Plus strategy shall be comprised of investment grade corporate and government bond mutual funds. Depending on credit risk conditions or interest rate volatility, this strategy may shift a portion of the assets to bond mutual funds that hold bonds that are lower than investment grade such as high yield bonds or to inflation protected bonds. In addition, this strategy may also invest in mutual funds that use derivatives, credit default swaps, merger/arbitrage and emerging market income positions. Specialty investments — with greater volatility — may be used from time to time to hedge risk and provide for smoother returns. Risk managed policies employ the use of cash or money market funds during adverse conditions; these positions could at times be 100%.
Prospective Client
This strategy is suitable for investors wanting a steady source of income with the potential for growth sufficient to maintain stable asset levels after inflation. The typical Income Plus client is the most risk adverse and will have a shorter investment time horizon than investors in other Potomac strategies.
Operations
Guardian
Objective
This strategy is designed to provide consistent conservative growth and preservation of capital by participating in U.S. and international markets and to limit portfolio volatility and risk of extensive loss.
Strategy Highlights
| Investment Objective: | Conservative |
| Account Minimum: | $50,000 |
| Investment Custodian: | Fidelity Investments |
| Strategy Inception Date: | 6/1/96 |
Description
The Guardian strategy is actively allocated across many sectors and/or asset classes, over weighting those exhibiting the best risk-to-reward ratio. Investments are primarily limited to low volatility mutual funds in an overall effort to reduce downside exposure. Through the careful selection of funds with a history of providing higher risk-adjusted returns, the opportunity for higher returns may still be achieved while maintaining lower risk. Specialty investments - with greater volatility - may be used from time to time to hedge risk and provide for smoother returns. Risk-managed policies employ the use of cash or money market funds during adverse conditions; these positions could at times be 100%.
Prospective Client
This strategy is suitable for investors wanting the broad diversification to equity markets offered by mutual funds. The typical Guardian client is most concerned with conservative growth and capital preservation.
Sales and Marketing
Navigrowth
Objective
This strategy is designed to provide moderate to aggressive growth while participating in U.S. and international markets and to limit portfolio volatility and risk of extensive loss.
Strategy Highlights
| Investment Objective: | Moderate Growth |
| Account Minimum: | $50,000 |
| Investment Custodian: | Fidelity Investments |
| Strategy Inception Date: | 11/1/1979 |
Description
The Navigrowth strategy is actively allocated across many sectors and/or asset classes over weighting those exhibiting the best risk-to-reward ratio. There are no restrictions on the risk level of investments chosen. However, investments are limited to mutual funds with an emphasis on those that exhibit superior risk-adjusted returns in an overall effort to promote growth while limiting risk. Specialty investments - with greater volatility - may be used from time to time to hedge risk and provide for smoother returns. Risk-managed policies employ the use of cash or money market funds during adverse conditions; these positions could at times be 100%.
Prospective Client
This strategy is suitable for investors wanting exposure to equity markets with an emphasis on a combination of moderate to aggressive growth and capital preservation. The typical Navigrowth client is willing to occasionally accept more risk than in other Potomac strategies with the goal of achieving a higher than market return while still preserving capital.
Specialty Strategy: Typically 10-20% of total portfolio
Bull Bear
Bull Bear
Objective
This strategy is designed to provide moderate to aggressive growth while participating in U.S. markets both on the long (buy) side and short (inverse) side, and to limit portfolio volatility and risk of extensive loss.
Strategy Highlights
| Investment Objective: | Moderate Growth |
| Account Minimum: | $50,000 |
| Investment Custodian: | Fidelity Investments |
| Strategy Inception Date: | 6/1/2002 |
Description
This strategy holds cash the majority of the time while waiting for the optimum opportunity to invest either on the long or short side. When Bull Bear does invest on the long side, it will buy a 150% leveraged S&P 500 index fund. The decision to move into the S&P 500-index fund is made by Potomac's Investment Committee upon review of various technical market indicators, and only when they are strongest. If the market indicators used to make investment decisions turn strongly negative, Potomac's Investment Committee may short the market through the use of an inverse fund.
Prospective Client
The typical Bull Bear investor has a long-term moderate to aggressive growth focus and invests only a portion of their portfolio in this strategy.
