Einstein Portfolio Review: 9 November 2022

Canyonlands National Park

Einstein is another Relative Strength (RS) portfolio that has not performed as well as expected, although it is outperforming its benchmark.  The expectation for RS portfolios is to resist draw-downs, and that has not been the case.  Portfolios that have resisted the bear market are those portfolios where fewer trades are conducted.  Next month I plan to do a serious review of the managed portfolios to see how to reduce transactions, thus saving on taxes in taxable accounts.

Einstein Investment Quiver

Below is the current Einstein portfolio which is currently heavy in cash.  Where to invest the nearly $50,000 is the major decision this month.  Follow along to see the recommendations.

Einstein Securities Recommendation

The Tranche worksheet from the Kipling spreadsheet shows five Buy recommendations.  There is some overlap with a few of the current equity holdings so that duplication needs to be taken into consideration.  The look-back combination is close to the default settings.  Instead of 50% allocation to the 60-trading days look-back, I increased it to 60% to more quickly respond to any rebounds.

The ESGV target filter is turned on and I am using the BHS model.

Einstein Manual Risk Adjustment

The big decision is to sell shares of SCHP in order to raise more cash to purchase shares of VTV, VOE, VBR, and MTUM.  I don’t plan to buy more VFH as it is not showing an over-sold percentage based on Bullish Percent Indicator data.  Mid- and small-cap value ETFs VOE and VBR will receive priority when filling the recommendations.

Einstein Performance Data

Since 11/30/2020 the Einstein is outperforming all three listed benchmarks.  A few up days for the equities market and the Einstein will be back in the black.

Einstein Risk Ratios

The good news is that the Einstein continues to show a positive Jensen Alpha value.  When evaluating the Einstein based on risk, the portfolio is performing rather well.  It just could be performing better and that is why I need to take stock of the BHS investing model.

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