Revised February 2022
The below applies to all fact sheets, marketing materials and performance updates for Cabana’s SMA (Separately Managed Account) Portfolios produced after December 31, 2018.
This document describes the method for calculating returns used in Cabana fact sheets and on the Target Drawdown Professional Portfolio and Target Income Portfolio Performance pages on Cabana’s website (targetdrawdown.thecabanagroup.com) The following descriptions cover gross of fee (“GOF”) calculation. We obtain net of fee (“NOF”) returns by discounting the GOF return by the appropriate prorated maximum advisory fee percentage. The management fee used is 2%, except for the Target Drawdown Professional 10 and Target Drawdown Legacy 10 strategy, which is 3% until 3/1/2017 and 2% thereafter. The following methodology applies to Cabana portfolio performance reported via Morningstar Institutional Data Management (“MSIDM”), Riskalyze Inc. (“Riskalyze”), Informa Intelligence, Inc. and as presented in Cabana’s SMA Portfolio fact sheets.
Trading records transfer daily from our various custodians (TD Ameritrade, Fidelity, Charles Schwab, etc.) to GeoWealth Management LLC. In order to determine returns using the Global Investment Performance Standard (GIPS) Cabana has retained Longs Peak Advisory Services, LLC (“Longs Peak”) to pull account balances, returns, cash flow, and percent cash on a monthly basis and to determine which accounts are GIPS composite members for each strategy. Longs Peak determines composite membership according to membership rules, for example a minimum account balance of $25,000 in starting monthly value, then reports asset-weighted GOF and NOF returns for each month for each strategy. Longs Peak also considers other composite membership rules, and Cabana’s input, in performing its work, such as rules related to cash flows.
In some reporting we may present monthly returns for time periods prior to the first investment of a strategy; such returns have been calculated based on simulated trading or hypothetical back testing. A disclosure of such back testing or simulated trading is included whenever back tested returns are reported. When reporting simulated trading returns, we disclose what data resulted from such back testing, often reporting such back tested returns separately.
We generate back tested returns by simulating each market day, using a trade cost of $1. We generate daily portfolio values by summing end-of-day prices of the component holdings, each multiplied by the respective holding weights. Monthly returns are generated by comparing consecutive end-of-month portfolio valuations.
Longs Peak derives statistics from returns consistent with GIPS methodology. We report these statistics on fact sheets. Cabana Asset Management (“Cabana”) claims compliance with the Global Investment Performance Standards (GIPS®). “GIPS® is a registered trademark of CFA Institute. CFA Institute does not endorse or promote this organization, nor does it warrant the accuracy or quality of the content contained herein. To receive additional information regarding Cabana, including GIPS Reports and performance information, please contact firstname.lastname@example.org.