Rutherford Portfolio Review (Tranche 3): 17 May 2024

Barrier Reef Outcrop, Queensland, Australia

It was a bullish week in US Equities with the S&P 500 Index (SPX) taking out previous all-time highs:

Since price has closed outside the bearish regression trend channel, and taken out the prior highs, I have added a tentative new uptrend channel – although I still have a feeling that the “round” 5300 barrier might still provide resistance. Wednesday’s “surge” through prior highs was likely exaggerated by short covering.

Despite the strong performance of US equities (up ~1.6% from last week’s close) it was not the strongest asset class over the past week:

with Emerging Market equities (VWO) doubling those returns.

At present, holdings in the Rutherford Portfolio look like this:

and performace like this:

slowly catching up with the Benchmark AOR Fund.

Present holdings in Tranche 3 (the focus of this week’s review) are the benchmark AOR Fund and Gold (GLD) – another strong performer over the past week. So let’s check on the rotation graphs:

where the recent strength in VWO is confirmed through the upward and left-to-right horizontal movement into the desirable top right quadrant. Moving to the ranking/recommendation sheet:

we see buy recommendations for VWO, PCY (Emerging Market Bonds) and AOR with a hold recommendation on GLD.

Consequently, my adjustments for this week will look something like this:

where I will be selling a portion of my current holdings in AOR and using the cash generated to add positions in VWO and PCY. I will not worry about the small adjustment in GLD to avoid unecessary trading costs. I do not expect these adjustment to make a significant difference unless the recent momentum in Emerging Market assets continues since AOR is a diversified equity/bond ETF on it’s own and we are just changing the focus slightly in favor of Emerging Markets.