Franklin Sector BPI Portfolio Review: 12 June 2025

“Life Jackets” – Employing Intentional Camera Movement technique.

One benefit of Sector BPI portfolios such as the Franklin is that there is a built in capital preservation ingredient inherent in the management model.  While Trailing Stop Loss Orders (TSLOs) may not be ideal, based on historical data, they are working for the three Sector BPI portfolios.  Check portfolios Carson and McClintock for further confirmation.

This morning I checked the Bullish Percent Indicator (BPI) data and there are no new recommendations for Sector BPI portfolios.  Overbought sectors have already been sold or are waiting for further market draw-downs.

Franklin Sector ETF Holdings

The Franklin is currently holding shares in four sectors.  Should a sector drop into the oversold zone I will sell sufficient shares of SHV to raise the necessary cash to bring the oversold sector up to the recommended level.  See the third column from the left.

Franklin Performance Data

Since 12/31/2021 the Franklin is besting all tracked benchmarks with exception of the S&P 500 (SPY).  When new cash is added to the Franklin I am purchasing more shares of SHV and will continue to do so until one or more sectors drops into the oversold zone.  Oversold is defined or triggered when 30% or fewer stocks within a sector are bullish.  BPI data comes from StockCharts.

Franklin Risk Ratios

All current risk ratios are higher than they were a year ago.  The slope (+0.13) of the critical Jensen Alpha is positive.

The reason the Treynor is so high is tied to a low beta and the fact that the Franklin is outperforming the AOR benchmark.

Give your attention to the Jensen Performance Index and the Information Ratio as those are the two most important risk ratios.

Tweaking Sector BPI Plus Investing Model: Part II