FCTE: Will Boutique Research Translate Into Market-Beating Returns?

2025-01-06 07:48:10 ET

Summary

• I own a small position in the SMI 3Fourteen Full-Cycle Trend ETF.
• The Fund aims to outperform the S&P 500 over the full investment cycle, using a proprietary "Full-Cycle Trend" strategy which targets high-quality large-cap companies.
• The Fund does not have a track record, has a relatively high expense ratio, and is dependent on the success of its proprietary investment strategy.
• Notwithstanding the risks, the Fund has successfully raised over $400 million in assets under management.

Introduction

In a recent article ("An Asset Allocation For 2025 and Beyond"), I highlighted the SMI 3Fourteen Full-Cycle Trend ETF ( FCTE ) (the " Fund ") as part of my investment allocation to "Quality Stocks." My current position in the Fund represents 0.50% of my overall investment portfolio. Because I respect one of the Fund's senior portfolio managers, Warren Pies, and his research firm, 3Fourteen Research (" 3Fourteen "), I expect to slowly grow the position despite some of the risks of owning the Fund highlighted in this article....

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