Investment Section

Asset Allocation Contest for Investment Section Members Only

We are pleased to announce the 2024 Investment Section Asset Allocation Contests (collectively "Contests;" individually "Contest"). For those who have participated before, the contest will be similar to the 2022 contest. Entries must be submitted by March 31. The contest will run April 1, 2024 - September 30, 2024.

We will continue to have three distinct Contests based on realistic scenarios. Participants are encouraged to enter a portfolio in each of the three Contests.

The three Contests are:

• Maximize Risk-Adjusted Alpha
• Maximize Accumulation
• Manage Drawdown Risk

Contests' Features

1. Contest portfolios start with a balance of $100,000 USD.
2. Each Contest can have its own specific asset allocation. Each portfolio must include at least four ETF funds with individual allocations of 10% of the portfolio or greater. Additional ETF funds may have allocations lower than 10%. Allocations must be whole numbers only, and there is no ability to incorporate negative numbers (no short positions).
3. There are two rebalancing options (manual rebalancing was removed due to low utilization):
1. No rebalancing.
2. Automatic rebalancing. Automatic rebalancing will reallocate the portfolio NAV to the initial allocation at the end of the last business day of each month (for each contest independently), received by 11:59 p.m. CDT. Automatic rebalancing must be selected with the initial entry; it cannot be added or cancelled after the Contests have opened.
4. NAV and standard deviation will be calculated on a daily basis.
5. The ETF lineup includes the 19 funds listed.
6. Asset performance will be recorded as seen on Yahoo! Finance using the adjusted closing price. Volatility calculations and other computations will be performed by Investment Section Council members using the adjusted closing price. Volatility calculations and other computations will be performed by Investment Section Council members using market-accepted formulas.

Prizes

There will be at least one winner for each contest. Multiple winners are allowed in the event of a tie. Each contest has a cash prize of $400. (For more detail, refer to section Prizes in the "2024 Asset Allocation Contest - Official Rules")

Standings

View the progess and standings for the 2024 Asset Allocation Contest.

• View Current Standings (September 2024)

Maximize Risk-Adjusted Alpha

For this contest, the goal is to produce the highest risk-adjusted alpha over the benchmark fund (60 percent ACWI, 40 percent AGG, rebalanced monthly). During the contest period, with alpha is defined as follows:

1. The realized return of your allocation, less
2. The realized return of the benchmark fund (60 percent ACWI, 40 percent AGG), scaled to achieve the same realized volatility of your allocation over the contest period.

For example, if your allocation returned 7 percent with 12 percent annualized volatility and the benchmark fund returned 5 percent with 10 percent annualized volatility over the period, your alpha would be 1 percent = (7 percent - (5 percent)*(1.2)). If your allocation returned 3 percent with 5 percent annualized volatility, your alpha would be 0.5 percent = (3 percent - (5 percent)*(0.5)).

Maximize Accumulation

The goal is to accumulate the maximum amount over the Contest period. Note the portfolio constraints above. We have removed the "manager review" and the provision for adding $10,000 per month.

Manage Drawdown Risk

The goal is to maximize the lifetime of your portfolio, where withdrawals of $900 (pulled from funds pro-rata) will occur at the end of each trading day until the account value is exhausted. It is possible that no portfolio will survive to the end of the contest. In that case, the last portfolio with positive value wins. If the last two (or more) portfolios run out on the same day, the highest value prior to the final withdrawal wins. If multiple portfolios remain positive at the end of the contest, the highest value wins.

Available ETF Funds

U.S. Equities:

Global Equities:

U.S. Bonds:

International Bonds:

Alternatives: