The ten (10) ETFs that make up the Rutherford 10 are the asset classes we have used for many years for back-testing various portfolio management models. At one time TIP was included in the 10, but recently, HedgeHunter substituted AGG for TIP as inflation is very low. It makes more sense to include a bond ETF (AGG) instead of an inflation protection ETF (TIP).
While there are high correlations among several of the domestic and international equity ETFs, there are plenty of low correlated ETFs to weather different market conditions. That should become evident as we watch the weekly reviews for different parts of the Rutherford portfolio.
Rutherford 10 Correlations: Below is the correlation data for the past eleven (11) years. Going back 11 years covers the Great Recession.
In a later blog I’ll show a correlation matrix for Schwab ETFs I plan to include in the Bethe portfolio.