ETF Portfolio Management, LLC

Trend Following

Rules-based trend-following strategies have been successfully used in the financial markets for over 30 years and collectively have well over $100 billion under management. A number of these managers have delivered strong long-term returns with gains in both of the equity market crashes this decade.

Historically, many investors have been unaware of trend following because it was offered by levered managed futures funds that charge performance fees. In recent years however, the growth in exchange-traded funds (ETFs) has enabled firms, such as ours, to offer this style of investing with no leverage and no performance fees. ETF PM’s oldest portfolio now has five years of strong actual performance, and three of the firm’s other active portfolios delivered double digit gains in the market downturn of 2008.

In order to learn more, please visit the links below that feature information and news about the trend-following investment discipline.

1) ETF PM explains why trend following is an important component for all diversified portfolios:

ETF PM on Trend Following

2) A number of leading trend followers delivered gains in the crash of 2008:

http://www.michaelcovel.com/2009/03/26/top-2008-earners-trend-followers-right-there/

3) Index Universe profiles ETF PM after the firm delivers positive returns in 2008:

http://www.indexuniverse.com/sections/features/5706-david-kreinces-qa.html?Itemid=5

4) In 2009, an index of trend-following funds fell 4.7%; its first decline in 15 years.

http://www.bloomberg.com/apps/news?pid=20601109&sid=a.d2vyHFS5Rc&pos=15#

5) Read one of the first books on trend following:

“TREND FOLLOWING: How Great Traders Make Millions in Up or Down Markets” by Michael Covel

6) The index shown here is primarily comprised of funds that employ trend-following strategies:

http://www.barclayhedge.com/research/indices/cta/sub/sys.html

7) This trend-following portfolio manager expresses his opinion about the future of investing:

http://business.asiaone.com/Business/My%2BMoney/Opinion/Story/A1Story20090608-146906.html

8) An article that compares discretionary fundamental trading strategies to rules-based trend following:

http://www.moneymanagement.com.au/article/Managed-futures-a-bright-spot-amid-the-gloom/487394.aspx