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– Explained –

What, exactly, is Star Min/Max?

Simple Trend And Rank ("STAR") Min/Max is a low-activity strategy designed for potential risk-managed outperformance over the long term. The strategy seeks to be Minimally invested in equities (stocks) when equities are trending downwards and Maximally invested in equities when equities are trending upwards. The STAR Min/Max portfolio is reallocated quarterly. The trend measurements used by the strategy are intermediate to longer-term (months to quarters timeframe). The strategy does not use the Intermediate indicator (short to intermediate timeframe) or the Bull-Bear indicator (longer term time frame).

Because STAR Min/Max acts only at quarterly intervals, and concentrates on asset classes commonly found in 401k-type retirement plans, it is also appropriate for managing retirement accounts and variable annuities.

What do we do to manage the assets that are earmarked for the Star Min/Max strategy?

At the start of each quarter, if equities (either Domestic or International) are in an uptrend, then equities are assigned the maximum allocation for the quarter. However, if both Domestic and International Equities are in downtrends, then equities are assigned the minimum allocation for the quarter. The equity portion of the portfolio consists of equal allocations to the Type 1 and Type 2 asset classes from our Asset Class Ranking Table - "Above Average - best for new positions" group. (We publish a current ranking table in our SITREP.) For the Fixed Income portion of the portfolio we either use our Multi-Sector Bond strategy, or a broad-based Bond Mutual Fund or an ETF. If the Fixed Income/Bond asset class is in a Bear market state, the Fixed Income portion is kept in Cash/Money Market.

What is behind the scenes that drives this strategy?

This Strategy combines relative-strength rankings (think “tug of war” and “no slackers”), current Market trends, and predetermined minimum and maximum equities exposure. It provides a very effective way to deal with typical "investor risk profile" considerations.

You have all heard us discuss what happens when you stay on the tracks and ignore the facts: “You can’t blame the wreck on the train”! The Star Min/Max indicator lets us know if the gates are up or down.


CAVU Financial LLC, any of its representatives, or any of its affiliates specifically represent that the information contained in this document does not constitute an offer to sell or the solicitation of an offer to buy any security or other investment or an offer to provide investment services of any kind.

While every effort is made to provide timely and accurate information, neither CAVU Financial LLC, nor its third party content providers shall be liable for any error, inaccuracies or delays in content, or for any actions taken in reliance thereon. This material was prepared by W.E. Sherman, LLC.

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which investment(s) may be appropriate for you, consult your financial advisor prior to investing. All performance referenced is historical and is no guarantee of future results. Investing involves risk including loss of principal.

There is no assurance that the investment objective of any investment strategy will be attained.

Equity (Stock) investing involves risk, including loss of principal

Bonds are subject to market and interest rate risk if sold prior to maturity. Bond values will decline as interest rates rise and bonds are subject to availability and change in price.