Using the ITA Risk Reduction model for VEU tells a completely different story from the prior analysis of VTI. Using the same time frames as we did for VTI, the first examination is to see what we do at the end of the month.
At the request of a long-time Platinum member, I am going to examine a number of key ETFs used to populate specific asset classes in an effort to see how well the ITA Risk Reduction model worked over the last four months. Keep in mind that no one ever stated that the ITARR model, or a variation such as the Faber-Richardson model, will work all the time, month after month. Where the ITARR model shows up well is when we have a severe bear market such as we experienced in 2008 and early 2009. But we are not in those situations every year, and for that we need to be thankful. Therefore, it makes sense to take a close look at the model in what we might call, "normal" times.