Phillip Wasserman Strategy

In these times of high volatility, people are looking for ways to get
diversified to protect their nest egg and try to capture as much of the upside
as possible.
But what exactly is diversification? Is it choice? A Jelly Bean Store can
have thousands of different choices of colors and flavors but everything you
buy is still a jelly bean.
True diversification is a mixture of uncorrelated, or lesser correlated items.
When looking for diversification in where you put your nest egg, you want
to be spread out across the different economies around the globe.
Where do you think we are going to see the economy improving in the next
10 years? China? Europe? Japan? America? How would you like to be in a
position where you would not have to guess which economy will grow the
fastest to be able to take advantage of that growth? That is what the new
“rainbow” crediting method does.
Many of the experts familiar with this strategy say it is like being able to bet
on the race after the horses have run. Here is how it works.
This strategy uses 4 indices from around the world, the Hang Seng in
China, the Dow Jones Eurostoxx 50 in Europe and the S & P 500 in
America. This strategy is not only diversified using economies from around
the world, but it is also weighted so that most of the money is going to the
indices that are producing the best results.
At the end of the year the rainbow strategy allocates 40% of the money in
the strategy to the index that has grown the most, 30% is allocated to the
index which came in second, the third placed index receives 20% of the
money and the trailing index is allocated only 10% of the money. This
means that the 70% of your money is allocated to the top 2 highest growth
indexes. It then adds up all these results and multiples the total by 60%. A
1.5% fee is subtracted. If the result is positive, your account is credited with
the earnings. If the result is negative or zero your account remains
unchanged from the prior year. So in up years, your account is growing at a
substantial rate and in down years your principal and past earnings are
protected.
Here is an example of how this would actually work:

Index A grows 60% x 40% of money is allocated = 24%

Index B grows 30% x 30% of money is allocated = 9%
Index C grows 20% x 20% of money is allocated = 4%
Index D shrinks 10% x 10% of money is allocated = -1%
Total = 36%
36% X 60% = 21.6% -1.5% spread =

20.1% interest credited

And you did not have to worry about which of the 4 Global Markets was the
one which was going to grow the most. This strategy did all of the work for
you!

This strategy has produced some tremendous results in the last couple of
years. Jack Marion in his paper titled “The Rainbow Connection (Getting
the largest pot of gold)” wrote – “If you had purchased a National
Western rainbow method index annuity every week beginning in October
2008 your average annual return through April 2010 was 17.8% based on
these assumptions. The capped products returned 5% to 7%. The reasons
for National Western’s exceptional performance are no cap and combining
indices that tend to zig when others zag.”
In summary, the Rainbow Strategy offers the most innovative response to
the volatile times we are currently living in. If you are looking for a way to
protect your retirement nest egg and still have a very good chance to earn
some impressive returns then this new and innovative strategy definitely
has earned a right to be heavily considered. Finding these kind of returns
with the safety that these products are famous for, is the perfect answer to
the uncertainty of the era in which we live.