An Introduction to Style Index Investing
 
By Ray Schumacher
 

Are you a fairly sophisticated investor with a portfolio of anywhere from a few thousand dollars up to, say, $2 million?

If so, you have probably discovered that picking individual stocks is difficult, time consuming, and has many uncertainties. You Ray Schumacherprobably also know that even the Mutual Fund pros, on average, under perform the market, as defined by the S&P 500 or Wilshire 5000, by the amount of their expenses and profit (1 to 2.5%/year).

Style Index Investing, as developed by Ray Schumacher, is designed to take emotion and uncertainty out of investing and allow you to sleep at night.

You simply monitor key indexes on a monthly basis and adjust your investment portfolio according to the market strengths indicated by Style Index Investing. Your portfolio, or any part of it you desire, is invested in an Index Fund. The Index Fund style you chose from is one of the extreme corners of the investment "style box".

Style Index Investing tells you when to be in the Index Fund that represents a segment of the market that is favored by investors, and likely to give you above average returns. Following the signals will take the emotional "excitement" out of investing, and put you on a track that invests with deliberation and logic.

Style Index Investing has recommended trades at roughly three-year intervals. Upon giving a switch signal, the entire portfolio of one index fund is sold and replaced by another index fund.

Maintaining the system is simple, requiring about half an hour a month if done by hand. Most months the answer will be "do nothing this month". Switch Signals are infrequent, avoiding the day-to-day investing fire drill.

The Style Index Investing system has been tested over the 29 years since January 1979. It will give you confidence to ride out the ups and downs of the market, and take maximum advantage of Capitalism's long history of success as expressed through a stock market that, over 200 years, has produced an average inflation free return of 6+ percent per year. Style Index Investing aims to double that return.

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