The Evergreen Core Funds
Very Conservative Investor
⦁ Cash position: 0% – 10%
⦁ Leverage: 0%
Goals / Ideal Investor:
⦁ Investing cash short-term for debt paydown or reserving cash for retirement
Total returns of the Evergreen Portfolio 2.0 since 1993
Our Evergreen Core portfolios are carefully designed and engineered to withstand just about any economic condition.
Since 1993 (28 years), the Evergreen Core portfolio has outperformed during over 2 economic recessions, 5 bear markets, and 16 interim market sell offs
Our portfolios have outperformed the S&P 500 and Fidelity Contrafund over this long period.
Key Ingredient #1: Diversity of ownership
Each portfolio owns adjusted weights across 12-15 ETF’s (exchange traded funds).
Each ETF holds between 70-80 individual stocks. This means your portfolio invests in over ~2,000 stocks at any given time.
No single stock can significantly impact your nest egg.
This is what we call smart investing.
Key Ingredient #2: Active Management
Each Evergreen portfolio is actively managed. This means that we regularly adjust our ETF ownership weights to the proper percentage based on where we are currently in an economic cycle. (i.e During the late-cycle we buy more Utilities and less Bank of America)
Smart investment managers can navigate these storms to ensure your capital is not only protected but FLOURISHES during any environment. Money is made in each cycle, but it is important to understand the forecast.
Our global economy traditionally moves in 4 unique cycles:
Early Cycle – Invest Aggressively
– Corporate earnings grow, consumers increase spending, unemployment declines. Consumer discretionary, financials, and real estate lead the market in outperformance.
Company Examples: Amazon, Walmart, Bank of America, Boston Properties
Mid-Cycle – Invest Offensively
The longest phase of the cycles. Strong economy, corporate earnings climb, and ow interest rates drive industrials, technology, and basic materials to outperform.
Company Examples: Facebook, Netflix, UPS, DuPont, Sherwin-Williams
Late Cycle – Invest Defensively
Economic growth slows, inflation climbs, and stock prices look expensive. Economic growth slows, inflation climbs, and stock prices look expensive. Best sector to invest are Energy, Utilities, Healthcare, and Consumer Staples.
Company Examples: Coned, Corporate bonds, Exxon Mobil, Procter & Gamble
Recession Phase – Preserve capital
Shortest phase of the cycles. Corporate profits decline, interest rates peak/fall, and consumer spending drops. Best sectors offer steady cash yields and benefit from the cycle turning such as Utilitites, Gold, Bonds, Consumer staples
Company Examples: Southern Company, Coca-Cola, UnitedHealth
Example: Evercore 2.0 smart portfolio of $100,000
Our dedicated team actively manages the ETF’s weights regularly to ensure the right portfolio balance.
This smart adjusted balance is the key to outperforming the stock market each year.
To save on overhead costs, we operate under a very light staff. However, we must ensure that we have the top tier investment managers across the industry. In order to retain top talent and keep the lights on we must charge a management fee of 1.0% of assets under management (AUM).
Key Ingredient #3: Smart Leverage - The geeky stuff....
- In today’s rate environment, the cost of leverage or debt is very low. Smart leverage functions within the portfolio primarily to lower the risk and volatility of the fund.
- How does debt lower risk? Easy, smart leverage is used to buy the most defensive and lowest risk assets. Defensive assets include large weights to bonds and gold.
- After investing all cash equity, we borrow money at very low interest rates (1.5% – 2% cost per year) and invest that capital into the portfolio. This serves to balance the portfolio between offensive “risk-on” and defensive “risk-off” assets.