Covestor model manager Navellier’s Allweather Premium model attempts to protect investors’ capital during down markets. They use alternative investment, large cap stocks, fixed income and ETFs to do so. This model tends to lag during up markets with returns of 20% or more.
The top position in this model is iShares MSCI Emerging Markets Index Fund (EEM). EEM is designed to mirror the results of the MSCI Emerging Markets index and, in order to do so, invests at least 90 percent of its underlying assets into securities and ADRs listed on the index. As of the date of this post it was trading at a small discount to NAV.
The next position is iShares MSCI EAFE Index Fund (EFA). EFA is modeled after the MSCI EAFE index and invests at least 90 percent of its underlying assets in securities of the MSCI EAFE index. On August 25th, 2010 it was trading at a discount to NAV.
The third top position in the Allweather Premium model is iShares Barclays 7-10 Year Treasury Bond Fund (IEF) which invests at least 90 percent of its assets in the bonds listed on Barclays Capital U.S. 7-10 Year Treasury Bond Index, the index whose performance it attempts to mirror. In an effort to ensure performance, the fund has no more than 10 percent of its assets in government bonds that are not listed in the index. IEF was trading at a small discount to NAV on the date this post was written.
Finally, the model has iShares S&P National Municipal Bond (MUB) as its fourth top holding. MUB attempts to replicate the performance of the S&P National AMT-Free Municipal Bond Index by investing 80 to 90 percent of its assets in bonds on the index or substantially similar positions meant to provide equal exposure to the index’s underlying assets. On August 24th, 2010 the fund was trading at a premium to NAV.
