Rutherford Portfolio Review (Tranche 3): 23 December 2022

Merry Christmas from Santa in Christchurch, New Zealand

Merry Christmas from Dunedin in New Zealand where I finally have a decent enough internet connection to write this post.

Following a relatively volatile but eventually uneventful week from US equities going into the Christmas holidays:

we are still sitting in the 2022 downtrend channel at the 38.2% retracement level from the early December pivot high at 4100 in the SPX (S&P 500 Index). Next week we will see whether we get a Santa rally into the end of the year, and whether we can break out of the channel (at ~3900) to retest those highs or whether we continue the downtrend to look for potential stronger support at 3700 (50% retracement), 3600 (61.8% retracement) or 3500 (100% retracement and a 12-month low).

In terms of relative performance to other asset classes US equities remain in the center of the pack with Commodities (including Gold) and Develeloped market equities leading the way. Bonds were the weakest assets classes, particularly long-term US Treasuries:

I was not able to make any adjustments as planned to Tranche 2, following last week’s review, due to poor internet connections, so the current holdings in the Rutherford Portfolio look like this:

and performance (following a rebalance of the allocations to each tranche) looks like this:

with performance in line with that of the benchmark AOR Fund.

Checking on the rotation graphs:

we see VEA,PCY and RWX well into the desirable top right quadrant.

However, when we take a look at the rankings and recommendations:

only VEA and PCY are recommended holds with GLD a recommended buy, together with the  benchmark AOR Fund.

If possible (i.e. with adequate internet connections) I will be trying to adjust as shown in the following screenshot:

i.e. I will be selling shares in VTI and using the funds to add to holdings in GLD. I will also be trying to adjust Tranche 2 as per last week’s suggestions.

Back in the New Year – Best Wishes for a Happy, Healthy and Wealthy 2023.

David