Building an all-weather portfolio: how to develop a portfolio for rain or shine...

Introducing the All-Weather Strategy

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In a volatile investment world, many investors want upside potential but want to minimize their downside risk. In other worlds they want to play both offense and defense. That is where the All-Weather Strategy works best. Think of it as your own personal “hedge fund”.

Since 2009, the All-Weather strategy at Faith-Based Investor has made over 102% for those following the strategy. Investors saw their profits increase by over 50% in 2009 followed by a nearly 30% return in 2010. How were these returns possible?

Think opportunity!

The All-Weather Portfolio alt is diversified with stocks and ETFs. The portfolio uses a wide variety of asset classes including real estate, stocks, bonds, precious metals, commodities, inverse ETFs, and is not afraid to hold cash during the tough times.

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Playing Offense

During the market meltdown of 2007-2008, the first quarter of 2009 presented some interesting investment opportunities. The All-Weather model identified that a new market wave was coming. This wave was full of risk and reward potential. The strategy is willing to take on risk when the time is appropriate and what better time when EVERYTHING was on sale.

So In 2009, the All-Weather portfolio bought:

F5 Networks (NASDAQ: FFIV) at $27 a share and sold it later at $91.01 (a 227% gain)
America’s Cart-Mart (NASDAQ: CRMT) at $9.27 and sold it later at $25.48 (a 175% gain)
Netgear (NASDAQ: NTGR) at $10.38 and sold later at $21.95 (a 111% gain)
National Oilwell Varco (NYSE: NOV) at $26.83 and sold later at $62 (a 131% gain)
Transglobe Energy (NYSE: TGA) at $2.60 and sold later at $13.39 (a 415% gain)
Clicksoft (NASDAQ: CKSW) at $1.99 and sold later at $8.75 (a 339% Gain)

In fact since 2009, the All-Weather portfolio has recommended 85 picks and nearly 10% of those picks (8 to be exact) have soared over 100%!

Of the 85 picks, only 10 have been closed with a loss. The greatest loss was 16% and the average loss was just 6%. The strategy is designed to let winners run while cutting losses.

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