Click to Access Advisor Site

AVOIDING LOSS OF PRINCIPAL IS KEY TO LONG-TERM SUCCESS

There is no such thing as a risk-free investment. Therefore, it is critical that investors learn to manage risk in order to make their portfolios less vulnerable to market volatility. BTS believes that combining strategic and tactical solutions offers a viable opportunity to mitigate such volatility.

Portfolio Loss Gain Required to Break Even
20% 25%
30% 43%
40% 66%
50% 100%

Since every market fluctuation contains the potential for gain and loss, the most successful strategy is the one with the potential to protect principal when the market goes down. Over the long term, consistent returns are crucial for investment success. Investors should look for portfolios that seek to avoid large drawdowns. The chart at right illustrates the consequences of varying losses in a portfolio. Given historical market returns, it could take a considerable amount of time to break even—time that is often not available.