By Seckel Capital Advisors The second quarter of 2014 was strong for the Select Sector Plus portfolio. The strategy benefitted from the volatility position added in April as well as full exposure to equities for the entire quarter. Total return for the quarter was +25.79% compared to the S&P 500 Total Return Index returning +5.23%. A breakdown of the strategy's performance and risk analysis are shown on the table below. The second quarter of 2014 is a good example of how our actively managed strategy can provide significant outperformance in up-markets, which we believe is a great value. We always aim to deliver risk adjusted returns across multiple market cycles. Domestic Equity: The domestic equity market was up +5.23% for the second quarter of 2014. There were two outliers relative to the market and the other sectors which are worth noting. Financials (XLF) was a clear underperformer for the quarter with a +2.20% return and energy (XLE) posted a large gain of +12.92%. Our strategy signaled a fully invested position in every domestic equity sector for the second quarter as each was in a clear uptrend with low levels of volatility. Volatility for the market and each sector individually has drifted lower in the second quarter. Although the VIX has been at levels not seen since 2007; implied (forward looking) volatility relative to realized (historic) volatility remains fairly consistent to historic ratios. Our allocation to volatility as an asset class was a large piece of our outperformance this quarter; these types of environments can be opportunities for our portfolios to appreciate substantially. Risk management is paramount when allocating to volatility and we can move to a neutral (cash) position quickly if need be. Market environments like the second quarter are optimal for our strategies and we'd expect to see substantial outperformance relative to the S&P 500 in those times.