Kepler Asset Allocation Portfolio Update: 6 February 2026

Morning Fog

Kepler is in the rebuilding phase.  In addition, the asset allocation is one of the most conservative of all the ITA portfolios.  Three of the “most needed” sectors are part of the Kepler and they are:  Health, Utilities, and Consumer Staples.  Even in the most difficult financial periods these three ETFs hold stocks that provide products needed for survival.

Several treasuries and bond type ETFs round out the portfolio.

Kepler Asset Allocation Holdings

The following asset allocation is not designed for major growth.  Instead, the Kepler is set up to temper a correction or recession.  A correction is defined as a 10% or greater draw-down when measured by the S&P 500.  At least this is the definition I am using.

Recession:  This definition has changed over the years, but I go by the old definition of two consecutive quarters of negative GDP.

Kepler Rebalancing Recommendations

The asset allocation for the Kepler is rounding into shape.  SGOV is the only ETF that is more than one percentage point below target.  I have several limit orders in place to pick up more shares of SGOV.  New cash deposits and dividends are used to keep the asset classes in balance.  At this point the Kepler requires basic maintenance to keep the asset classes within a percentage point of the recommended target.

Kepler Performance Data

Since 12/31/2021 the Kepler has not been able to see the IRR in positive territory.  The hope is that this will change sometime this year.

The VT data is in error as it should be well into positive territory.

Kepler Risk Ratios

Checking in on the Jensen Alpha or frequently referred to as the Jensen Performance Index, we see improvement since last September.  Jensen is the most important of the four risk measurements so keep an eye on the direction of this ratio.  Over this past year the slope or direction is still negative.

The value of the Kepler has increased over the year as indicated by the Sortino Ratio.