Pauling Portfolio Review: 6 August 2025

From Swan Island Dahlias.

Pauling is another mini-asset allocation portfolios where the number of ETFs populating the portfolio are limited.  In anticipation of a slower economy when third and fourth quarter economic reports come out, I’ve concentrated on building up short-term treasuries in a number of portfolios.

If managing a family portfolio, my recommendation is to diversify across the globe and do it through a variety of management styles.  Here at ITA multiple management models are examples for readers.  Some of the management models may be too complicated to implement while others are quite simple.  It does not get more simple than the Schrodinger where computers manage the portfolio.  The results are quite strong.  If looking for the Schrodinger, move to the upper right-hand corner of the page and look for the magnifier icon.  Click on it and ask for the portfolio of interest.

Copernicus is another easy model to follow for investors still working and have little time to watch over the portfolio.

Of all the portfolios discussed here at ITA, the Schrodinger and Huygens are classical asset allocation portfolios in that they are constructed around a well-diversified set of securities.

Pauling Security Holdings

The following table shows the current holdings for the Pauling.  SHV if out of balance or oversubscribed while the three equity ETFs are well below target.  With the small amount of cash available I set a limit order to purchase one share of VOO and a few shares of SCHG.  Dividends for SHV will be paid today providing more cash to set additional limit orders.

I generally set the limit orders somewhere between 2% and 10% below the current price.  With Schwab the limit orders are in effect for six months.

Pauling Performance Data

Since 12/31/2021 the Pauling has trailed all benchmarks and will continue to do so with this conservative approach should the market continue to rise.  I’m with Warren Buffett when it comes to viewing the current market as overvalued or overbought.  Buffett is sitting on billions in cash waiting for better buying opportunities.  The Pauling has a few thousand sitting in SHV waiting for better price opportunities.

Pauling Risk Ratios

When a portfolio is not beating its benchmark I look to the Risk Ratios for more detailed information when it comes to direction of growth.  The Sortino Ratio indicates the portfolio is more valuable than it was a year ago.  However, the Jensen Alpha indicates the portfolio is more “risky” than it was in August of 2024.

The Information Ratio indicates the portfolio is not keeping pace with the benchmark.  This is no surprise based on the Internal Rate of Return (IRR) delta difference.

Copernicus Portfolio Review: 24 February 2025

Pauling II Update: 1 April 2024

Huygens Asset Allocation Portfolio Review: 10 April 2024