Charles Schwab

Conservative Investing at Paragon

If you are looking for a conservative portfolio that seeks to avoid loss of capital and has an excellent track record, Paragon’s Managed Income Portfolio may be a good fit for you.

Designed for the conservative investor, this portfolio's objective is to generate higher returns than bank certificates of deposit or traditional bond portfolios without the volatility normally associated with the stock market. This portfolio is managed using some of the same techniques that Top Flight, Paragon’s growth portfolio originally pioneered, but with a much more conservative approach.

The principal asset classes we rotate between include: Start-Investing

  • Treasury, High-yield and Emerging Market Bond Funds
  • Real Estate Investment Trusts (International and Domestic)
  • Utility Stock Funds
  • Bank Loan, Convertible, Preferred and Dividend Income Funds
  • Alternative Strategy Funds
  • Low Volatility Funds
  • Money Market Instruments

Objectives

First: Preserve Capital
Second: Generate returns superior to bank CDs and traditional bond portfolios.

Neither objective is guaranteed, and in the past there have been times when the portfolio has declined. Historically, this portfolio has experienced significantly less volatility than Top Flight, Paragon’s growth portfolio. For a good overview of the portfolio’s risk/reward characteristics, please review the Managed Income performance graph below.

Investment Vehicles

This portfolio primarily invests in exchange traded funds (ETFs) or no load mutual funds that concentrate their investments in particular asset classes. Our experience shows that investing in ETFs and mutual funds provides the portfolio with the greatest investment flexibility.

Performance

The Managed Income Performance graph below shows the composite net performance of all of the Paragon clients who invested in the Managed Income Portfolio. These results represent the net return clients received after paying management and transaction fees. (See disclosure statements.)

Management

This portfolio is managed by processing market data through separate quantitative models that measure asset class desirability. Paragon also uses models to screen several thousand ETFs and mutual funds within the target asset classes to determine which funds are ranked highest. At any given time, the portfolio may include 8 to 12 positions representing various asset class combinations.

Occasionally, as opportunities present themselves, a small portion (less than 20%) of the portfolio will be allocated to low risk / high probability short-term trades using ETFs or equity-based mutual funds.

To preserve capital, the portfolio will normally exit out of volatile positions at a much earlier stage than Top Flight, Paragon's growth portfolio.

 Paragon's Conservative Portfolio's Performance:


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