Rutherford Portfolio Review (Tranche 4): 26 April 2024

Bali Ha’i awaits you – Indonesia

Although US equities closed up ~2.5% from last week’s close it was not a smooth ride – with a bounce from last week’s close early in the week to a retest of the ~5000 support level on Thursday and a jump back up on Friday. We remain in the tentative downtrend channel that started ~1 month ago:

Friday’s strong bounce placed VTI near the top of the weekly performance list for major asset classes:

Over the past few weeks we have been rotating out of equities and into more defensive asset classes in the Rutherford Portfolio although the portfolio is probably holding ~50% in equities at the present time (including the equity holdings in the benchmark AOR Fund):

Performance looks like this:

and is closely following that of the benchmark fund.

We will check to see whether there are any recommended adjustments to be made in Tranche 4 (the focus of this week’s review) that is the poorest performing tranche to date as a result of review date (timing) luck. First a look at the rotation graphs:

where we see GLD (Gold) and DBC (Commodities) still dominating that desirable top right quadrant.

Checking the recommendations from the ranking sheet:

we see a Buy recommendation for VWO (Emerging Market Equities) and a Hold recommendation on GLD. A little surprising perhaps is that there is no Buy recommendation on DBC – although it is close with a Score of 8 (9 is required for a Buy) and only the very short-term HA signal holding us back. This could flip any day from here with a small bounce.

However, I’ll show a little discipline and go with the recommendations such that the adjustments will look something like this:

where I will sell current holdings in VTI, VEA and PCY and use the cash generated to add positions in VWO and AOR. This likely won’t make a huge difference unless there is a geographical shift in where investors decide to place their money.