Another scarecrow in Canby.
As I am updating and reviewing portfolios, thus far Kepler is the only portfolio that did not show a profit during the month of September. Kepler happens to be the only portfolio using Closed-End-Funds. I need to remind readers that the Hawking is also a CEF driven portfolio and appears to be performing better than the Kepler. Despite all the third quarter dividends, the Kepler lost money so the CEFs themselves were not profitable.
Kepler CEF Asset Allocation
Below are the holdings for the Kepler. The goal is to hold 5.0% of the portfolio in each CEF. Rebalancing explanations are provided below.
Kepler Rebalancing Recommendations
As for rebalancing, four limit orders are in place to put the available cash to work. When rebalancing I first look to see which CEFs are most out of balance and carry a Buy recommendation. Once these limit orders bring assets into balance I move on to the next CEFs that is most out of balance. Readers can see which CEFs are currently holding limit orders.
Kepler Performance Data
Since 12/31/2021 the Kepler has under performed the AOR benchmark by a wide margin. The Kepler has only been using the CEF approach for 4.5 months so the under performance is not all due to this management approach.
I use the commercial program, Investment Account Manager to calculate the Internal Rate of Return data. I highly recommend this program for serious investors.
Kepler Risk Ratios
Now that the Kepler is under a new management model we pay additional attention to growth or retrograde motion from month to month. Since June the Sortino Ratio has improved. We do not see the same growth in the Jensen Alpha or Jensen Performance Index. That is of concern.
The Information Ratio is a strong indicator of how the portfolio is performing vs. the benchmark and here again we see the Kepler is falling behind the benchmark. Should this continue over the next year I will most likely evaluate the entire idea of using CEFs to populate a portfolio.
Comments are always welcome.
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Lowell,
I didn’t look at them all your tickers, but prices of FAX, OXLC, and XFLT have been steadily going down for over a month. I finally sold XFLT, a floating rate fund.
~jim
Jim,
OXLC also had a 1 for 5 split, not the best sign of strength.
Lowell