Bethe Portfolio Review: 25 August 2025

Cutsforth Market Cruise In

Bethe is another mini-asset allocation portfolio up for review.  If you have been reading this blog for any length of time you know I am leaning more and more toward capital preservation.  This interview with Howard Marks only tilts me further in this direction.  Pay particular attention to the S&P 500 statistics around the 5:50 time mark.  Begin earlier to understand the context of what Marks is saying.  The current P/E ratio of the S&P 500 is currently somewhere between 25 and 29 depending on the source determining the value.  In other words, the broad equities market is overpriced.  The entire interview is well worth a listen.

Bethe Security Holdings

Below is the current asset allocation for the Bethe.  I am setting TSLOs under VTI, VOO, SCHG, and SCHD.  When sold the cash will be invested in SHV and I will be looking for other income generating ETFs.  We are in a period where the equities market is overvalued combined with immense political uncertainty.  This is a combination that does not bode well for the U.S. stock market.

While I am not a huge fan of bonds, this is a time to look in that direction for future investing.  International bonds (BNDX) is another possibility as the current yield is 4.3%.  Not quite as good as SHV.

Bethe Performance Data

Since 12/31/2021 the Bethe lags the AOR benchmark by a small amount and is far behind the overvalued S&P 500.  Should the market collapse and the portfolio is holding non-equity securities the gap could close.  This is a big if as we certainly cannot predict the future.

Bethe Risk Ratios

Based on the two most critical risk ratios (Jensen and Information) the Bethe is weaker today compared to where it was a year ago.  Part of this is due to the fact that funds were withdrawn from this account at a critical period as the owner needed cash for personal reasons.  More recently, cash has been added back into the account in an effort to rebuild the portfolio.

Pay attention to the Howard Marks interview and pass the link on to your friends.