Those who are familiar with the seasonal tendencies of the stock market know that as a general rule the stock market tends to perform best from November through April and worst from May through October. Within individual sectors of the overall market, there are also unique seasonal tendencies as well. This strategy uses 17 different sectors and invests in them based on their historical seasonal tendencies for about 3 to 6 months at a time. Based on the rules of this strategy, it becomes more defensive during the time of year when the market tends to perform poorest, and it become more aggressive during the season when it tends to perform best. Some Sectors are excluded from this model either to reduce the risk of the model or because the seasonal tendencies of the sector is not as strong.
Energy (FXN), Health Care (FXH), Consumer Staples (FXG), Utilities (FXU), Defense & Aerospace (ITA), Technology (RYT), Internet (FDN), MLPs (AMJ), Consumer Discretionary (FXD), Real Estate (VNQ), Industrials (FXR), Construction (XHB), Oil Services (IEZ), Materials (FXZ), Treasuries (TLT), Corporate bonds (CIU), Mortgage Backed Securities (VMBS)