After spending the last few days developing and setting up the Pauling II Asset Allocation portfolio (not finished) it is time to get back to reviewing one of the many Sector BPI portfolios. McClintock is the portfolio scheduled for review this morning. Based on Bullish Percent Indicator (BPI) data from last week, no buy or sell recommendations are forthcoming. Are any decisions necessary? That all depends on the level of cash available so lets get started with the analysis.
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McClintock Security Holdings
The following investment quiver and holdings is common or par for the Sector BPI portfolios. No sectors are in the oversold zone while Consumer Staples and Utilities continue to hover in the “neutral” zone. Thus no action is required of any sector ETFs. In situations such as this one we look to VTI and VOO for investment opportunities, assuming cash is available. The McClintock holds nearly $1230 in cash so we will make a decision as to what to do with this money.
McClintock Manual Risk Adjustments
There is sufficient cash to pick up two more shares of VOO so a limit order is set to do just that. Otherwise, no further decisions are required.
McClintock Performance Data
Since 12/31/2021 the McClintock is lagging the SPY benchmark by a tad under one percentage point. The portfolio is besting the other five (5) potential benchmarks.
McClintock Risk Ratios
Over the past year the McClintock improved when we check out the Return/Risk metric. The slope (0.42) of the Jensen Performance Index provides this information. The Information Ratio is a mixed bag as the portfolio is not performing as well as it was last year at this time. We do need to recall that 2023 was a very strong year for equities.
The Jensen value, frequently called the Jensen Alpha, is much better at taking in market fluctuations. It accounts for the risk taken by the portfolio manager and interest rates are also an important part of the calculation.
Pauling II is approaching full asset class investments. I need to sell some shares of VOO so cash is available to populate the asset classes still not up to the recommended percentage. I hope to have the Pauling II fully operational by the May review.
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Lowell
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