iQ S&P 500 Efficiency (UIT) Model

 

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INVESTMENT OBJECTIVE

The iQ S&P 500 Efficiency Model seeks to outperform the S&P 500 index by selecting 20 stocks based on Capital Efficiency, Relative Strength Efficiency, and Price Momentum Efficiency.

PROCESS

The iQ S&P 500 Efficiency Model selects its holdings based on the following rules-based investment process:

  • Starting Universe = The S&P 500 Index

  • Sort the 500 companies (of the S&P 500 Index) by Operating Earnings Yield plus Share Buyback Yield and select the top 100.

  • Sort the remaining 100 companies by 18-month Relative Strength Index (RSI) and select the top 60 stocks.

  • Sort the remaining 60 stocks by risk-adjusted price momentum and select the top 20 stocks

  • Re-constitute every calendar year.

If this hypothetical Model had been applied since 1976, the returns may have been higher than the S&P 500 Index.