Cabana LLC, dba Cabana Asset Management (“Cabana”), is an SEC registered investment adviser. Cabana only transacts business in states where it is properly registered, or is exempted from registration requirements. Registration as an investment adviser is not an endorsement  by securities regulators and does not mean that Cabana has achieved a specific level of skill or ability. Additional information regarding Cabana, including its fees, can be found in Cabana’s Form CRS or Form ADV, Part 2, a copy of which is available upon request or online at www.adviserinfo.sec.gov/. . 

The Verified Hypothetical Model (“VHM”) is provided for illustrative purposes only and should not be relied upon as actual performance. The performance data and metrics represented in the VHM are derived from hypothetical back-testing of Cabana’s proprietary algorithm and do not represent returns during a time when actual client funds were invested. The hypothetical back-tested data depicted has been independently examined by a third-party.  Actual performance data for Cabana’s Portfolios can be found online at http://targetdrawdown.thecabanagroup.com/. 

Hypothetical back testing involves a hypothetical reconstruction, based on past market data, of what the performance of a composite may have been if the adviser had managed the composite using a specific investment strategy. Hypothetical back-tested returns do not represent actual trading and do not accurately reflect the impact of transaction costs or material economic and market factors on the adviser’s decision-making during this time frame. As a result, actual returns will likely vary significantly from hypothetical back-tested returns. Specific limitations and differences between the VHM and Cabana’s Target Drawdown Series of live portfolios (“Cabana’s Portfolios”), include but are not limited to, the following: 

1. Variance in the timing of trades. The VHM reflects automatic end–of–day trading upon receipt of a rebalance signal from Cabana’s proprietary algorithm. However, Cabana’s Portfolios are generally subject to at a 3 to 5 day delay from the time a rebalance is signaled to the time the rebalancing is completed. This delay accounts for Cabana’s blackout procedures, trading preparation, and execution via third–party trading systems. The resulting variance in trading execution can and likely will have a material impact on performance between the VHM and Cabana’s Portfolios. In addition, Cabana’s trading will be subject to trade errors from time to time which could cause additional delays and changes in variances in performance. 

1. Variance in cash allocation. Cabana’s Portfolio’s allocate 2% to cash to account for liquidity needs (i.e. fees) whereas the VHM reflects a 0% cash allocation for modeling purposes. The difference in allocation results in a variance in performance between the VHM and Cabana’s Portfolio’s which will likely be material when applied over an extended time period. 

1. Modifications to Cabana’s proprietary algorithm. Cabana’s proprietary algorithm has been incrementally modified over time to optimize and automate its methodology. The version of Cabana’s algorithm used in the VHM is not the same as that is currently used in Cabana’s Portfolios and therefore will be material variances in performance as a result of such modifications. For instance, the current version of Cabana’s proprietary algorithm includes automated price, earnings and yield curve evaluation whereas such data was manually input and evaluated in previous versions (including that used to calculate the VHM) of the Cabana’s algorithm. Additionally, the universe of products available to Cabana’s algorithm will change from time to time as more products become available in the market, which will likely materially impact performance over time. 

Unless otherwise indicated, performance data, benchmark comparisons, and statistics are for illustrative purposes and shown gross of advisory fees but net of trading costs. Performance data is expressed in U.S. dollar currency and it includes the reinvestment of dividends and capital gains. Target Drawdown is identified on a gross of advisory fees but net of trading costs basis. PTTRX is comprised primarily of intermediate-term, investment grade bonds. VBINX invests roughly 60% in stocks and 40% in bonds by tracking two indexes that represent broad barometers for the U.S. equity and U.S. taxable bond markets. SPY is an ETF that tracks the performance of 500 leading U.S. large cap companies. Benchmark indices will likely materially differ from Cabana’s Portfolios. Additional information regarding the VHM methodology can be found on the Independent Verifier’s report, which is appended and available upon request. Detailed information as to how the returns are calculated can be obtained online from the following link http://bit.ly/thecabanagroup_performance_reporting_methodology_July2019. 

No client should assume that the future performance of any specific investment or strategy will be profitable or equal to past performance. All investment strategies have different degrees of risk and the potential for profit or loss.  There is no guarantee that any specific investment or strategy will be suitable or profitable for any investor. Asset allocation and diversification will not necessarily improve an investor’s returns and cannot eliminate the risk of investment losses. While loss tolerance and targeted “drawdown” are identified on the front end for each portfolio, Cabana’s algorithm does not take any one client’s situation into account. It is the responsibility of the advisor to determine what is suitable for the client. An advisor should not simply rely on the name of any portfolio to determine what is suitable. Cabana manages assets on multiple custodial platforms. Performance results for specific investors will vary based upon differences in associated costs and asset availability. All references to Cabana’s proprietary algorithm in this fact sheet refer to the most current version of the algorithm as of the date this fact sheet is published. 

This material is proprietary, and is not to be copied, reproduced, altered, deconstructed, or distributed without the express written consent of Cabana, LLC.