Pauling Asset Allocation Portfolio Review: 12 March 2025

Practicing for worship. Mt Angel Abby Chapel

Pauling is an Asset Allocation style portfolio converging on one year of operating under this investing model.  Over the past 3.25 years the results have been disappointing.  As the portfolio reaches the point where all asset classes are in balance, we will then begin to evaluate returns and risks.

Pauling Asset Allocation Holdings

Below are the current holdings for the Pauling.  Limit orders are in for a few different asset classes and if any were struck since writing this blog I will pick up that information on the next update which will occur later this month.

Pauling Rebalancing Recommendations

Pay attention as I walk through the rebalancing process as explained in a recent rebalancing blog post.

• If an asset class shows up as a Sell or Hold we do nothing.  If the asset class is below target we still do nothing.  BNDX, VB, and VOO are all below target, but show a Sell.  Therefore we do nothing.  When a Buy shows up I will sell shares of SHV to raise cash to bring the asset class up to target.  With a portfolio this size I like to keep the asset class percentages within -/- one percentage point.
• BND and TLT are below target so market or limit orders are placed to purchase 7 and 5 shares respectively.  I may have set a limit order for six shares of TLT so it ends up above target by a factional percentage point.
• If cash remains I use it to purchase more shares of SHV.

Pauling Performance Data

As mentioned above, the Pauling lags the AOR benchmark over the past 3.25 years.  And it is far behind the SPY benchmark.  The goal of the AA investing model is to close the gap on the AOR benchmark.

Pauling Risk Ratios

Last year at this time the Pauling was languishing on every front.  The four risk ratios improved since then, but the March data is disappointing as I figured the bond holdings would bring a tad more support to the return/risk ratio in this down market.

The one bright light is the Jensen slope.  We need at least another six months of data to place any judgment on this asset allocation breakdown.

Questions and Comments are always welcome.