Goals and risk management...

I thought I would back up and cover my goals for investments, and why I invest in only ETFs. 

My overall goal is to maximize my returns give a few conditions.  I want "limited" risk, I want low draw downs (aka low downside volatility), and I don't want to spend hours and hours every day managing my money.

So, the limited risk I achieve by owning only ETFs.  I also consider mutual funds, but I prefer to exit at a price I know instead of the end-of-day price.  Additionally, I have been burned by previous ownership in individual names announcing bad news that then blows through stops.  The ETFs hold multiple names so this type of single name shock. 

Diversification is another method I use to limit risk.  My asset allocation model limits the amount of any one instrument that I can hold to 5% usually, or 10% under certain circumstances. 

The limiting of risk and the low draw down I achieve by following a simple timing model much like Mebane Faber of the Ivy Portfolio fame.  I use the 40 week moving average, which is nearly equivillent to the 10 month moving average that he expounds in his papers & books.  It is just easier for me to get data on the 40 week average than the 10 month.

Finally, I have limited time, and as they say time is money, so I want a systematic way to determine investments, make the trades, and move on.  My model does that, and attempts to limit trades to the minimum necessary.