Rutherford Portfolio Review (Tranche 1): 22 September 2023

Bird-of-Paradise Plants – Botanic Gardens, Auckland, New Zealand

We finally got that inevitable breakout from the pendant pattern that has been setting up for a month or so – resulting in a 3% downside move in US equities over the past week and leaving us sitting at ~4300 in the SPX (S&P 500 Index) and at the top of a potential support zone:

From here we will wait to see whether we get a bounce back towards the top of the recent downtrend channel (but still within the longer term uptrend) or a continuation of the downtrend  below current levels that might lead us to accept that the bullish trend is over and we are at the start of a new downtrend.

Compared to other major asset classes – US equities came in close to the bottom of the list in terms of performance over the past week:

although all classes were weak, with only Gold showing any positive returns.

Current holdings in the (tranched) Rutherford Portfolio look like this:

with Tranche 1 (the focus of this week’s review) holding positions only in Commodities (DBC) and Cash.

Checking the rotation graphs:

only Commodities are showing any strength, resulting in the following recommendations from the rotation model:

Consequently I shall be holding my current shares in DBC (but not adding additional shares) and adding 22 shares (10% allocation) of SVXY that I do not include in the Risk Parity allocation calculations:

I will use the remaining Cash to Buy BIL (short-term Treasury Notes).