Heron, Australia
US Equities had a strong week with the S&P 500 Index ending the week ~5.5% higher than last week’s close:
Prices have broken out of the downward trend channel but are sitting at the 440-445 level that may offer strong resistance and push prices back into the channel. Volatility has dropped from the 30% range to ~ 25%.
Looking at the performance of other asset classes:
we see that equities, globally, performed strongly with the defensive commodity and gold funds falling to the bottom of the pile. This is reflected in the performance of the Rutherford Portfolio:
that gave back some of it’s recent gains from the earlier strength in commodities (DBC) and Gold (GLD). Current holdings look like this:
with shares of DBC being sold from Tranche 3 (the focus of this week’s review) on a TSLO order (that I had forgotten about). The tranche is therefore currently holding a little over $10,000 in Cash.
Checking current rankings and recommendations for the BHS model:
we see a Hold recommendation for Commodities (DBC) but no Buy recommendations.
Taking a look at the rotation graphs:
we see the recent short-term weakness in the defensive asset classes (downward movement) but no obvious strength anywhere else.
Recommendations from a rotation model look like this:
suggesting that we stick with the defensive asset classes – although there is strength in the short-term HA signals of equities and real estate. This provides an unclear picture of where to go from here but I will add a little diversification to the portfolio by using the available Cash to purchase shares in the benchmark AOR fund:
I will also hold onto the shares currently held in VWO even though the recommendation is to Sell. This avoids a little churning and will allow me to pick up the quarterly dividend.
David
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