Interim returns (Jan-Aug 2017) with Cambria Investments

So I feel a bit like Bas Rutten of investing; “Let me tell you. I’ve been around..”.

Bas Rutten

In my investing lifetime I’ve tried everything from stock buy/sell, getting fancy with options. Getting my ass handed to me in the Futures markets, optimal, tactical, set-and-forget. You name it, odds are I’ve probably done it. I’ve never blown up an account, but have had some painful losses.

During all my years in trading I had one super-fantastic year. The rest were dogs at best. It was clear what I was doing was not working. And I needed to find a better way. It also doesn’t help when you have a full-time job, where you can’t be at the trading screen all day. It certainly felt like I was the bag-holder by the time I either got into or out of something.

Which leads me to where the latest stages of my investing journey are going. A few years ago I read Meb Faber’s “The Ivy Portfolio” and really liked the premise — and more importantly the returns. I’m also a big fan of Meb and his work. That started leading me down the path of “hands off” investing.

Initially I tried to manually build and maintain various tactical portfolios. This seemed ok but still kept me “managing” things more than I liked. I then looked at various services that would do this. Traditional money managers were out because.. well after doing it myself, the knowledge level (and returns) of most of those guys is laughable. Thanks but no thanks to the big fees and churning my portfolio.

More recently I had tried Hedgeable (hedgeable.com). And for the first half year or so it was great. Then the market started into a chop-fest period.. and the hedging started eating the returns. I also suspect they “tweaked” the model, which further crimped actual returns. Nice company but the results weren’t showing for me.

Hedgeable returns % From Jan-2016
Here’s where the year ended with Hedgeable. Yeah, sucked.

That led me to start looking around again. And that’s when I discovered Cambria Investments (http://www.cambriainvestments.com/). I had already known about the individual ETFs (CambriaFunds.com) they underwrote. Was one of those wierd people that actually read the reports, etc. But never felt confident enough to build out a portfolio with their offerings.

But there was something new (to me at least), where Cambria Investments started offering “Trinity” portfolios; which were constructed of mostly Cambria funds (GMOM, GVAL, SYLD, FYLD, etc). And they built out the allocation models based on risk tolerance and goals. Even more convenient is tax-loss harvesting between taxable and IRA accounts. Nice. http://www.cambriainvestments.com/our-services/#personal . This was compelling to me.

http://www.cambriainvestments.com/wp-content/uploads/2017/01/Trinity_WP_122816_A.pdf

The fee structure is decent. Cambria takes no fees. And Betterment takes 0.15%. The rest are whatever the individual ETF fees are; which are all well south of 1%. My current avg is 0.68% annually. I think the value-add they offer in tactical adjustments, and my personal stress levels, and quite simply overall returns are worth what I’m paying. And so far I am very pleased with the returns. They aren’t out-of-this world, but are pretty respectable considering it’s a “balanced” tactical portfolio.

Also, betterment.com is the engine that manages the back-end, so it’s likely not going to be one of the brokerages I was at, that unexpectedly shuttered one morning. Yeah not a good feeling.

Comparison vs SPY

The above are my “so far” returns for 2017. Note that the IRA accounts didn’t transfer until after Jan-1 (not Cambria’s fault). Overall very happy with Cambria so far. Also note: The FFA generally has biweekly deposits from normal cash flow. The IRAs have had no additional $ this year. And I’m in Trinity 6 (most aggressive) in all accounts. This made the most sense to me. The Cambria Investments FAQ has some good answers.

*UPDATE* Cambria just posted the latest returns of their Trinity portfolios: http://www.cambriainvestments.com/wp-content/uploads/2017/08/Trinity-Historical-Performance-6.30.17.pdf

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