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TANGLEWOOD WEALTH MANAGEMENT, INC.
ALL EQUITY COMPOSITE
ANNUAL DISCLOSURE PRESENTATION
 
 
 

The above chart assumes a hypothetical investment of $1,000,000 into the Composite and Taxable Benchmark on January 1, 1999. Composite performance is illustrated both net and gross of fees for the period shown. The Benchmark performance assumes all dividends are reinvested and does not reflect any management fees, transaction costs or expenses. Benchmarks and underlying Indexes are unmanaged and one cannot invest directly in either. Past performance is not indicative of future results.

 

All Equity Composite contains fully discretionary accounts with a 100% Equity allocation including some exposure to international stocks. The All Equity Portfolio is a diversified portfolio that seeks to provide a level of long-term growth of capital with similar characteristics of the S & P 500 Index. The All Equity Portfolio is designed to limit downside declines during bear market periods consistent with the declines of the S & P 500 Index. 
 

For comparison purposes the composite is measured against a blended benchmark.  For 2011, the benchmark is as follows: 54% Russell 3000, 35% Vanguard FTSE All World Ex US ETF (VEU), 5% SPRD Gold Trust (GLD), 5% FTSE NAREIT Equity REIT Index, 1% Citigroup 1 mo Treasury Bill (recalculated annually). 


For periods prior to 2011, the following benchmark was used: 59% Russell 1000, 11% Russell 2000, 25% MSCI EAFE (net) and 5% NAREIT Equity REIT indices (recalculated quarterly). The benchmark and rebalancing frequency was updated on 1/1/2011 to better-reflect the current investment environment while maintaining the desired risk/reward characteristics.  
 

All Index performance information was obtained from public sources and although deemed reliable, not guaranteed by Tanglewood. Additional information regarding benchmark calculations is available upon request.

   

Index Descriptions:

 

U.S. Stocks: The Russell 3000 index measures the total return of the 3,000 largest companies in the US. This index is reconstituted annually (May31). The index is adjusted for free float and liquidity so the benchmark reflects the shares that are actually available on the open market.

 

REITS: The National Association of Real Estate Investment Trust (NAREIT), Equity REIT index, which measures the total return of most REITS which own, or have an “equity interest” in rental real estate.

 

International Stocks: The Vanguard FTSE All World ex US ETF (VEU) is designed to help US investors benchmark their international investments. The ETF comprises Large and Mid cap stocks providing coverage of Developed and Emerging Markets (46 countries) excluding the US. The underlying index is adjusted for free float and liquidity so the benchmark reflects the shares that are actually available on the open market.

 

Bonds:

A) The Barclay’s US Aggregate Index covers the US Dollar denominated, investment grade, fixed rate, and taxable areas of the bond market. This is the broadest measure of the taxable US bond market, including most Treasury, agency, corporate, mortgage-backed, asset-backed, and international dollar-denominated issues, all with investment grade ratings (rated Baa3 or above by Moody’s) and maturities of 1 year or more.

B) The Barclays Capital 5-Year U.S. Treasury Bellwethers Index is an unmanaged universe of 5 Yr Treasury bonds, and used as a benchmark against the market for intermediate-term maturity fixed-income securities. The index assumes reinvestment of all distributions and interest payments.

 

Gold: SPDR Gold ETF (GLD). This ETF is designed to track the London Fix Gold AM Price, the internationally recognized benchmark for gold prices set by the members of the London Bullion Market Association. It is based on actual buy and sell orders for gold in the global market.

 

Cash: The Citigroup 1 Month Treasury Bill Index is a market value weighted index of public obligations of the US Treasury with maturities of 1 month.

 

The information included in this report is based upon data obtained from public sources believed to be reliable; however, Tanglewood Wealth Management, Inc. does not guarantee the completeness or accuracy thereof.

 

Important Disclosures

 

The Total Return found under “Reward” represents the annualized growth rate of the benchmark portfolio for the time period shown with all interest, dividends and capital gains reinvested.

 

The Cumulative values found throughout the chart and in December of the final year represent the ending market value at the end of the period assuming a $100,000 hypothetical initial investment was made in the benchmark portfolio on January 1, 1991. Asset classes are rebalanced on January 1 of each year back to their original stated benchmark weightings.

 

Benchmark returns are for illustrative purposes only and do not represent actual Tanglewood Wealth Management, Inc. performance. Underlying Index returns do not reflect any management fees, transaction costs or expenses. Indexes are unmanaged and one cannot invest directly in an index. 

 

On January 1, 2011, the benchmark allocations and index representations were updated to better-reflect the current investment environment while maintaining the desired risk/reward characteristics. Returns shown for periods prior to January 1, 2011 reflect the benchmark allocations shown below.            
 Benchmarks for Tanglewood Investment Policies
(used for periods prior to 12/31/2010)

Benchmark Allocations


Conservative


Moderate


Growth



All Equity

Asset Class

Index Representation

Moderately

Conservative

Moderate

Growth

Cash

30-day U.S. Treasury Bills

20%

15%

10%

7%

5%

0%

Bonds

Citigroup 5-yr U.S. Treasury

50%

45%

40%

33%

25%

NA

U.S. Small Co. Stocks

Russell 2000 Index

3%

4.5%

6%

6.5%

8%

11%

Real Estate

FTSE NAREIT Equity REIT Index

2%

2.5%

3%

3.5%

4%

5%

U.S. Large Co. Stocks

Russell 1000 Index

19%

24%

29%

35%

42%

59%

Int’l Stocks

MSCI EAFE (Net) Index

6%

9%

12%

15%

16%

25%

                           Past Performance is no indication of future results.
 
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