Important Statement Disclosures
Benchmarks
The following are the components of benchmarks that are utilized in Charter Oak Capital Management Portfolio Review Reports. Please note that it is not possible to invest directly into indexes.
Conservative Benchmark: 30% MSCI ACWI All Country World Index, 34% Barclay's Global Aggregate X-US Hedged Index, 34% Barclay's US Aggregate Float Adjusted Composite, 2% Bank of America/Merrill Lynch UST-Bill 3 Month Cash Index
Moderate Benchmark: 49% MSCI ACWI All Country World Index, 24.50% Barclay's Global Aggregate X-US Hedged Index, 24.50% Barclay's US Aggregate Float Adjusted Composite, 2% Bank of America/Merrill Lynch UST-Bill 3 Month Cash Index
Growth Benchmark: 69% MSCI ACWI All Country World Index, 14.50% Barclay's Global Aggregate X-US Hedged Index, 14.50% Barclay's US Aggregate Float Adjusted Composite, 2% Bank of America/Merrill Lynch UST-Bill 3 Month Cash Index
Accounts managed by Charter Oak Capital Management follow materially different investment strategies from the composition and performance of indices referenced herein and are not managed to mirror a specific index. Unless indicated otherwise, indices are unmanaged, cannot be invested into directly, are inclusive of reinvested dividends, and do not include the deduction of transaction, custodial or investment management fees that would further reduce actual performance if included. Indices are the property of their respective owners, all rights reserved. Results shown are net of fees and expenses, although the presentation of the Index is not net of fees because there are no fees or expenses to deduct from an index. Index information is provided for general educational purposes and not as a comparison to the adviser's performance presentation.
Index Definition
S&P 500 Index has been widely regarded as the best single gauge of the U.S. equities market. The index includes 500 leading companies in leading industries of the U.S. economy. Although the S&P 500 focuses on the large cap segment of the market, with approximately 75% coverage of U.S. equities, it is also an ideal proxy for the total market.
Barclay's US Aggregate Float Adjusted Composite is a custom, market-weighted USD-hedged index designed to track the global investment-grade bond market and is comprised of the Barclay's US Aggregate Float Adjusted Index and the Barclay's Global Aggregate ex-USD Float Adjusted RIC Capped Index. The international portion of the bond index is USD hedged to lower foreign currency volatility in returns.
Bank of America/Merrill Lynch UST-Bill 3 Month Cash Index is a measure of global investment grade debt from 24 local currency markets. This multi- currency benchmark includes treasury, government-related, corporate and securitized fixed-rate bonds from both developed and emerging markets issuers.
Barclay's Global Aggregate X-US Hedged Index is comprised of a single issue purchased at the beginning of the month and held for a full month. At the end of the month that issue is sold and rolled into a newly selected issue. The issue selected at each month-end rebalancing is the outstanding Treasury Bill that matures closest to, but not beyond, three months from the rebalancing date. To qualify for selection, an issue must have settled on or before the month-end rebalancing date.
MSCI ACWI Index is a free float-adjusted market capitalization weighted index that is designed to measure the equity market performance of developed and emerging markets around the globe, including the United States. The MSCI ACWI consists of 45 country indices comprising 24 developed and 21 emerging market country indices.
Performance Return Calculation Definition
Internal Rate of Return (IRR) represents a portfolio’s actual performance and rate of return. It takes into account the size of any cash flows that occur during the reporting period as well as the length of time that each cash flow affects a portfolio. It also gives greater weight to those time periods when more money is invested in a portfolio. IRR does not measure portfolio strategy because the IRR is affected by the adding or withdrawing money.
Time-Weighted Return (TWR) measures performance by weighing every time period equally, regardless of the amount of money invested during the reporting period and minimizes the effect of cash flows on a portfolio’s performance. TWR is used to measure the performance and compare this performance to a benchmark. TWR is the only calculation that fairly compares the performance of one money manager with the performance of another or with an index. It does not represent a portfolio’s actual return if significant contributions and withdrawals occur during a reporting period. Instead, a TWR represents an investment strategy and hypothetically assumes that there were no large additions or withdrawals.