Aim Ways Ulcer Free Strategy To EUR Bond Hedged Portfolio: ETF allocation and returns

Data Source: from January 1994 to April 2024 (~30 years)
Consolidated Returns as of 30 April 2024
Currency: EUR

The Aim Ways Ulcer Free Strategy To EUR Bond Hedged Portfolio is a Low Risk portfolio and can be implemented with 5 ETFs.

It's exposed for 7% on the Stock Market and for 11% on Commodities.

In the last 30 Years, the Aim Ways Ulcer Free Strategy To EUR Bond Hedged Portfolio obtained a 5.79% compound annual return, with a 4.90% standard deviation.

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About the Author

Hello. I am "AIM WAYS". I was bord in 1969; I live in Italy and I'm Italian; my name is Carmine.

For almost 15 years -I was not yet 21 years old- I was a tied-agent on behalf of a leading Italian asset management company. Thereafter, I abandoned single-mandate model, and for 13 years I was involved in straightforward consulting.

With changing regulations in the industry sector, in 2018 I decided to permanently abandon the classic 'Output-Economy' approach (focused on the placement of instruments) to face a new concept: financial coaching.

Challenge consists in being able to generate income revenues (for me), with value and full reward for the investor/prospect.

It is the cornerstone of the 'Outcome-Economy': a new 'ecosystem' in which, RELATIONSHIP (Advisory), is the main pillar, through major tool: 'Goal based investing'; my policy does NOT allow "recommenda- tions on financial instruments."

Basically, I focus on the 'CORE' stages of <Consulting Process>; that is: once the 'anamnesis' is taken and the correct 'therapy' (including 'dosage') is identified, it will then be the interactor -now sufficiently learned- to choose both 'pharmacy' and specific 'medicine'.

After all these years professionally engaged in personal finance, I still manage to be passionate about the world of investments.

Portfolio Overview

“Ulcer-Free”, designed for several goals, containing “Ulcer-Index”. Index measures “emotional pain” from swings in listed assets. It's to work on unease and impulsiveness, for those with very low tolerance and capacity risk, by guarding their savings from relevant declines.

Strategy aims to balance several elements, including: stability, fixed income, inflation protection, and equity appreciation. It's worth noting that, investment choices, involve ‘risks’ find their correct ‘garrison’ in conforming allocations to: specific needs, time horizon, and investor's “risk appeal”.

Other targets include: Sharpe ratio properly rewarding investor, relative to their risk spent; a real return, at least, 2 or 3 points above long-term average inflation. And, as a result of “final gap of an output process”, a ‘perpetual’ withdrawal rate, that gives realistic statistical confidence of survival of decumulation, relative to the beneficiary.

Policy and structure of strategy
  • 7% US large cap growth: sector tracks performance of large-cap companies, considered with high growth potential.
  • 34% US intermediate bond 7-10 years: government intermediate securities provide stability and income to the portfolio. These are (generally) statistically less risky than short-term or high-yield bonds.
  • 34% Internat. all-term bonds: all listed in developed markets; a contribute to geographic credit diversification, with exposure to government debt, issued only by economically advanced countries.
  • 14% Bloomberg US convert. securit. all-term bond: convertible offer a combination of fixed income and equity appreciation (exchange for shares of issuing companies) but with much lower volatility.
  • 11% Gold commodity: share in gold is oriented to reducing maximum drawdowns and protecting against inflation; in addition acting as a ‘safe-haven’ during times of economic turbulence.

Asset Allocation and ETFs

The Aim Ways Ulcer Free Strategy To EUR Bond Hedged Portfolio has the following asset allocation:

7% Stocks
82% Fixed Income
11% Commodities

The Aim Ways Ulcer Free Strategy To EUR Bond Hedged Portfolio can be implemented with the following ETFs:

Weight
(%)
Investment Themes (Orig.Currency) ETF
Ticker
ETF
Currency
ETF Name
7.00 Equity, U.S., Large Cap, Growth (USD)
SXRV.DE
EUR iShares Nasdaq 100
34.00 Fixed Income (Mix)
EUNA.DE
EUR
Hedged
iShares Core Global Aggregate Bond EUR Hedged
34.00 Bond, U.S., Intermediate-Term (USD)
IBB1.DE
EUR
Hedged
iShares USD Treasury Bond 7-10yr Eur Hedged
14.00 Fixed Income (USD)
SPF1.DE
EUR
Hedged
SPDR Refinitiv Global Convertible Bond EUR Hedged
11.00 Commodity, Gold (USD)
PHAU
EUR WisdomTree Physical Gold

Most of Lazy Portfolios are made of common components (asset classes), very simple and well defined. For a more complete view, find out the most common ETFs you can use to build your portfolio.

Portfolio and ETF Returns as of Apr 30, 2024

The Aim Ways Ulcer Free Strategy To EUR Bond Hedged Portfolio guaranteed the following returns.

Returns are calculated in EUR, assuming:
  • no fees or capital gain taxes.
  • a rebalancing of the components at every January 1st. How do returns change with different rebalancing strategies?
  • the adjustment for actual currency exchange rates (simulation derived from original US returns)
  • the currency hedging (simulation taking into account the interest rate differentials of the countries). It is also assumed that hedged instruments have an additional expense ratio of 0.25% (yearly), compared to the US original instrument.
  • the actual Euro Inflation rates.
AIM WAYS ULCER FREE STRATEGY TO EUR BOND HEDGED PORTFOLIO
Consolidated returns as of 30 April 2024
Swipe left to see all data
  Chg (%) Return (%) Return (%) as of Apr 30, 2024
  1 Day Time ET(*) May 2024 1M 6M 1Y 5Y 10Y 30Y MAX
(~30Y)
Aim Ways Ulcer Free Strategy To EUR Bond Hedged Portfolio n.a. n.a. -1.55 6.79 3.57 2.08 2.85 5.79 5.52
Euro Inflation Adjusted return -2.12 5.51 1.16 -1.57 0.54 3.65 3.36
Components
SXRV.DE
EUR iShares Nasdaq 100 n.a. - n.a. -2.33 22.14 39.11 19.53 21.08 13.62 13.04
EUNA.DE
EUR
Hedged
iShares Core Global Aggregate Bond EUR Hedged n.a. - n.a. -1.75 4.03 -0.08 -1.62 0.12 3.72 3.49
IBB1.DE
EUR
Hedged
iShares USD Treasury Bond 7-10yr Eur Hedged n.a. - n.a. -3.17 2.61 -7.07 -2.89 -0.72 4.06 3.81
SPF1.DE
EUR
Hedged
SPDR Refinitiv Global Convertible Bond EUR Hedged n.a. - n.a. -1.95 9.42 8.62 4.04 3.68 6.29 6.15
PHAU
EUR WisdomTree Physical Gold n.a. - n.a. 4.49 13.79 18.75 12.95 8.29 6.24 5.86
Returns over 1 year are annualized | Available data source: since Jan 1994
(*) Eastern Time (ET - America/New York)
Euro Inflation is updated to Apr 2024. Current inflation (annualized) is 1Y: 2.38% , 5Y: 3.70% , 10Y: 2.30% , 30Y: 2.07%

Capital Growth as of Apr 30, 2024

An investment of 1€, since May 1994, now would be worth 5.42€, with a total return of 441.56% (5.79% annualized).

The Inflation Adjusted Capital now would be 2.93€, with a net total return of 193.04% (3.65% annualized).
An investment of 1€, since January 1994, now would be worth 5.10€, with a total return of 410.35% (5.52% annualized).

The Inflation Adjusted Capital now would be 2.73€, with a net total return of 172.65% (3.36% annualized).

Portfolio Metrics as of Apr 30, 2024

Metrics of Aim Ways Ulcer Free Strategy To EUR Bond Hedged Portfolio, updated as of 30 April 2024.

Metrics are calculated based on monthly returns, assuming:
  • no fees or capital gain taxes.
  • a rebalancing of the components at every January 1st. How do returns change with different rebalancing strategies?
  • the adjustment for actual currency exchange rates (simulation derived from original US returns)
  • the currency hedging (simulation taking into account the interest rate differentials of the countries). It is also assumed that hedged instruments have an additional expense ratio of 0.25% (yearly), compared to the US original instrument.
  • the actual Euro Inflation rates.
AIM WAYS ULCER FREE STRATEGY TO EUR BOND HEDGED PORTFOLIO
Advanced Metrics
Data Source: 1 January 1994 - 30 April 2024 (~30 years)
Swipe left to see all data
Metrics as of Apr 30, 2024
1M 3M 6M 1Y 3Y 5Y 10Y 20Y 30Y MAX
(~30Y)
Investment Return (%) -1.55 -0.22 6.79 3.57 -1.79 2.08 2.85 4.64 5.79 5.52
Infl. Adjusted Return (%) details -2.12 -2.16 5.51 1.16 -6.97 -1.57 0.54 2.48 3.65 3.36
Euro Inflation (%) 0.58 1.98 1.21 2.38 5.57 3.70 2.30 2.11 2.07 2.09
Returns / Inflation rates over 1 year are annualized.
DRAWDOWN
Inflation Adjusted:
Inflation Adjusted:
1Y 3Y 5Y 10Y 20Y 30Y MAX
Deepest Drawdown Depth (%) -3.67 -15.22 -15.22 -15.22 -15.22 -15.22 -15.22
Start to Recovery (# months) details 5 32* 32* 32* 32* 32* 32*
Start (yyyy mm) 2023 08 2021 09 2021 09 2021 09 2021 09 2021 09 2021 09
Start to Bottom (# months) 3 14 14 14 14 14 14
Bottom (yyyy mm) 2023 10 2022 10 2022 10 2022 10 2022 10 2022 10 2022 10
Bottom to End (# months) 2 18 18 18 18 18 18
End (yyyy mm) 2023 12 - - - - - -
Longest Drawdown Depth (%)
same as
deepest

same as
deepest

same as
deepest

same as
deepest

same as
deepest

same as
deepest

same as
deepest
Start to Recovery (# months) details
Start (yyyy mm) 2023 08 2021 09 2021 09 2021 09 2021 09 2021 09 2021 09
Start to Bottom (# months) 3 14 14 14 14 14 14
Bottom (yyyy mm) 2023 10 2022 10 2022 10 2022 10 2022 10 2022 10 2022 10
Bottom to End (# months) 2 18 18 18 18 18 18
End (yyyy mm) 2023 12 - - - - - -
Longest negative period (# months) details 6 36* 51 51 51 51 51
Period Start (yyyy mm) 2023 05 2021 05 2019 08 2019 08 2019 08 2019 08 2019 08
Period End (yyyy mm) 2023 10 2024 04 2023 10 2023 10 2023 10 2023 10 2023 10
Annualized Return (%) -5.95 -1.79 -0.01 -0.01 -0.01 -0.01 -0.01
Drawdowns / Negative periods marked with * are in progress
Deepest Drawdown Depth (%) -4.58 -25.38 -26.42 -26.42 -26.42 -26.42 -26.42
Start to Recovery (# months) details 5 32* 40* 40* 40* 40* 40*
Start (yyyy mm) 2023 08 2021 09 2021 01 2021 01 2021 01 2021 01 2021 01
Start to Bottom (# months) 3 26 34 34 34 34 34
Bottom (yyyy mm) 2023 10 2023 10 2023 10 2023 10 2023 10 2023 10 2023 10
Bottom to End (# months) 2 6 6 6 6 6 6
End (yyyy mm) 2023 12 - - - - - -
Longest Drawdown Depth (%)
same as
deepest

same as
deepest

same as
deepest

same as
deepest

same as
deepest

same as
deepest

same as
deepest
Start to Recovery (# months) details
Start (yyyy mm) 2023 08 2021 09 2021 01 2021 01 2021 01 2021 01 2021 01
Start to Bottom (# months) 3 26 34 34 34 34 34
Bottom (yyyy mm) 2023 10 2023 10 2023 10 2023 10 2023 10 2023 10 2023 10
Bottom to End (# months) 2 6 6 6 6 6 6
End (yyyy mm) 2023 12 - - - - - -
Longest negative period (# months) details 7 36* 60* 114 135 135 135
Period Start (yyyy mm) 2023 05 2021 05 2019 05 2014 05 2012 08 2012 08 2012 08
Period End (yyyy mm) 2023 11 2024 04 2024 04 2023 10 2023 10 2023 10 2023 10
Annualized Return (%) -0.28 -6.97 -1.57 0.00 -0.01 -0.01 -0.01
Drawdowns / Negative periods marked with * are in progress
RISK INDICATORS
1Y 3Y 5Y 10Y 20Y 30Y MAX
Standard Deviation (%) 5.80 6.60 5.96 5.01 4.55 4.90 4.96
Sharpe Ratio -0.30 -0.67 0.03 0.32 0.72 0.72 0.31
Sortino Ratio -0.48 -0.98 0.04 0.45 1.00 1.03 0.44
Ulcer Index 1.38 9.36 7.31 5.31 3.85 3.24 3.58
Ratio: Return / Standard Deviation 0.61 -0.27 0.35 0.57 1.02 1.18 1.11
Ratio: Return / Deepest Drawdown 0.97 -0.12 0.14 0.19 0.30 0.38 0.36
% Positive Months details 50% 47% 56% 60% 63% 65% 64%
Positive Months 6 17 34 72 153 234 235
Negative Months 6 19 26 48 87 126 129
LONG TERM RETURNS
Inflation Adjusted:
Inflation Adjusted:
1Y 3Y 5Y 10Y 20Y 30Y MAX
Best 10 Years Return (%) - Annualized 2.85 7.29 8.89 8.89
Worst 10 Years Return (%) - Annualized 2.26 2.26 2.26
Best 10 Years Return (%) - Annualized 0.54 5.50 6.86 6.86
Worst 10 Years Return (%) - Annualized 0.14 0.14 0.14
ROLLING PERIODS
Inflation Adjusted:
Inflation Adjusted:
1Y 3Y 5Y 10Y 20Y 30Y MAX
Over the latest 30Y
Best Rolling Return (%) - Annualized 20.99 14.23 13.64 8.89 8.01 5.79
Worst Rolling Return (%) - Annualized -14.67 -3.70 1.00 2.26 4.37
% Positive Periods 87% 93% 100% 100% 100% 100%
SWR - Safe Withdrawal Rate (%) - 100% Success - Annualized 86.63 28.10 20.08 11.00 6.71 6.66
PWR - Perpetual Withdrawal Rate (%) - 100% Success - Annualized - - - 0.16 2.51 4.39
WR calculated based on initial capital | Monthly withdrawals adjusted for inflation | Credits: BestRetirementPortfolio.com
Best Rolling Return (%) - Annualized 19.21 12.43 11.84 6.86 6.14 3.65
Worst Rolling Return (%) - Annualized -22.60 -9.00 -2.35 0.14 2.20
% Positive Periods 80% 91% 92% 100% 100% 100%
SWR - Safe Withdrawal Rate (%) - 100% Success - Annualized 86.63 28.10 20.08 11.00 6.71 6.66
PWR - Perpetual Withdrawal Rate (%) - 100% Success - Annualized - - - 0.16 2.51 4.39
WR calculated based on initial capital | Monthly withdrawals adjusted for inflation | Credits: BestRetirementPortfolio.com
Over all the available data source (Jan 1994 - Apr 2024)
Best Rolling Return (%) - Annualized 20.99 14.23 13.64 8.89 8.01 5.79
Worst Rolling Return (%) - Annualized -14.67 -3.70 1.00 2.26 4.37 5.55
% Positive Periods 86% 93% 100% 100% 100% 100%
SWR - Safe Withdrawal Rate (%) - 100% Success - Annualized 86.63 28.10 20.08 11.00 6.71 6.11
PWR - Perpetual Withdrawal Rate (%) - 100% Success - Annualized - - - 0.16 2.51 3.90
WR calculated based on initial capital | Monthly withdrawals adjusted for inflation | Credits: BestRetirementPortfolio.com
Best Rolling Return (%) - Annualized 19.21 12.43 11.84 6.86 6.14 3.66
Worst Rolling Return (%) - Annualized -22.60 -9.00 -2.35 0.14 2.20 3.45
% Positive Periods 79% 91% 92% 100% 100% 100%
SWR - Safe Withdrawal Rate (%) - 100% Success - Annualized 86.63 28.10 20.08 11.00 6.71 6.11
PWR - Perpetual Withdrawal Rate (%) - 100% Success - Annualized - - - 0.16 2.51 3.90
WR calculated based on initial capital | Monthly withdrawals adjusted for inflation | Credits: BestRetirementPortfolio.com
Terms and Definitions
  • Annualized Portfolio Return: it's the annualized geometric mean return of the portfolio.
  • Deepest/Longest Drawdown: a drawdown refers to the decline in value from a relative peak value to a relative trough. The deepest (or maximum) drawdown is the maximum observed loss from a peak to a trough of a portfolio before a new peak is attained. The longest drawdown is the period observed from a peak to the subsequent peak with the greatest duration.
  • Longest negative period: it's the maximum period for which an overall negative return has been observed.
  • Standard Deviation: it's a measure of the dispersion of returns around the mean.
  • Sharpe Ratio: it's a measure of risk-adjusted performance of the portfolio. It's calculated by dividing the excess return of the portfolio over the risk-free rate by the portfolio standard deviation. The risk-free rate here considered is the 1-3 Mth T-Bill return.
  • Sortino Ratio: another measure of risk-adjusted performance of the portfolio. It's a modification of the Sharpe Ratio (same formula but the denominator is the portfolio downside standard deviation).
  • Ulcer Index: it's a measure of downside risk that quantifies the depth and duration of drawdowns in an investment portfolio.
  • Best/Worst 10Y returns: the best and the worst 10-year return over a time frame.
  • Rolling Returns: N-year returns over a time frame, calculated over all the available data source (best, worst, % of positive returns). Each rolling period, longer than the longest negative period, yielded a non-negative minimum return.
  • Safe Withdrawal Rate (SWR): it's the percentage of the initial portfolio balance that can be withdrawn at the beginning of each month with inflation adjustment, without the portfolio running out of money in any case (money amount withdrawal).
    For instance: Your initial invested capital is 100.000$; withdrawal rate (annualized) is 4%. This means that, in the first month, you will withdraw 100.000 * 4% * 1/12 = 333.33$. The second month, you’ll withdraw 333.33$ plus the inflation monthly rate. You’ll continue adjusting your withdraw monthly for inflation.
  • Perpetual Withdrawal Rate (PWR): it's the percentage of the initial portfolio balance that can be withdrawn at the beginning of each month with inflation adjustment, preserving the original invested capital, adjusted for inflation too.

Portfolio Components Correlation

Correlation measures to what degree the returns of the two assets move in relation to each other.

Correlation coefficient is a numerical value between -1 and +1. If one variable goes up by a certain amount, the correlation coefficient indicates which way the other variable moves and by how much.
Asset correlations are calculated based on monthly returns.
COMPONENTS MONTHLY CORRELATIONS
Monthly correlations as of 30 April 2024
Swipe left to see all data

If you want to learn more about historical correlations, you can find out here how the main asset class are correlated to each other.

Drawdowns

A drawdown refers to the decline in value from a relative peak value to a relative trough. A maximum drawdown is the maximum observed loss from a peak to a trough of a portfolio before a new peak is attained.

AIM WAYS ULCER FREE STRATEGY TO EUR BOND HEDGED PORTFOLIO
Drawdown periods
Drawdown periods - Inflation Adjusted
Data Source: 1 May 1994 - 30 April 2024 (30 Years)
Data Source: 1 January 1994 - 30 April 2024 (~30 years)
Inflation Adjusted:
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Rolling Returns

( more details)

A rolling return is a measure of investment performance that calculates the return of an investment over a set period of time, with the starting date rolling forward. This approach can provide a more accurate representation of the investment's historical performance and helps investors to evaluate the investment's consistency over time.

AIM WAYS ULCER FREE STRATEGY TO EUR BOND HEDGED PORTFOLIO
Annualized Rolling Returns
Annualized Rolling Returns - Inflation Adjusted
Data Source: 1 May 1994 - 30 April 2024 (30 Years)
Data Source: 1 January 1994 - 30 April 2024 (~30 years)
Inflation Adjusted:

If you need a deeper detail about rolling returns, please refer to the Aim Ways Ulcer Free Strategy To EUR Bond Hedged Portfolio: Rolling Returns page.

Seasonality

In which months is it better to invest in Aim Ways Ulcer Free Strategy To EUR Bond Hedged Portfolio?

Both the Average Return and the Gain Frequency (Win %) are useful to get an idea of what happened in the past.
For further information about the seasonality, check the Asset Class Seasonality page.
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Monthly Returns

This section provides a visual/tabular representation of the performance variability in the Aim Ways Ulcer Free Strategy To EUR Bond Hedged Portfolio over time. It illustrates the distribution of monthly returns, showcasing the range and frequency of positive and negative returns.

AIM WAYS ULCER FREE STRATEGY TO EUR BOND HEDGED PORTFOLIO
Monthly Returns Distribution
Data Source: 1 May 1994 - 30 April 2024 (30 Years)
Data Source: 1 January 1994 - 30 April 2024 (~30 years)
234 Positive Months (65%) - 126 Negative Months (35%)
235 Positive Months (65%) - 129 Negative Months (35%)
Swipe left to see all data
(Scroll down to see all data)
Investment Returns, up to March 2019, have been derived using the historical series of equivalent ETFs / Assets, instead of the actual ETFs of the portfolio.
You can find additional information on extended Data Sources here.

Returns are calculated based on the performance of the original US asset, adjusted for actual currency exchange rates.
Hedged returns are calculated taking into account the interest rate differentials of the countries. It is assumed that hedged instruments have an additional expense ratio of 0.25% (yearly).

In particular, the series derived from equivalent datasets are:
  • SXRV.DE - iShares Nasdaq 100 (SXRV.DE), up to June 2010
  • EUNA.DE - iShares Core Global Aggregate Bond EUR Hedged (EUNA.DE), up to December 2017
  • IBB1.DE - iShares USD Treasury Bond 7-10yr Eur Hedged (IBB1.DE), up to March 2019
  • SPF1.DE - SPDR Refinitiv Global Convertible Bond EUR Hedged (SPF1.DE), up to May 2018
  • PHAU - WisdomTree Physical Gold (PHAU), up to January 2008
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