Rutherford Portfolio Review (Tranche 4): 28 March 2024

Melbourne Skyline, Australia

US Markets started the week slowly with a small pullback at the beginning of the week but finished the holiday-shortened week with a recovery and closing about 0.25% higher than last week’s close:

However, we are still hovering at that 5200-5220 level that is providing some resistance to possible moves higher – at least in the short term – but, it’s an election year and these years are historically bullish in a seasonal sense.

In terms of performance relative to other major asset classes:

US equities came out in the middle of the pack with defensive asset classes performing slightly better.

Current holdings in the Rutherford Portfolio look like this:

with performance pretty much in line with the benchmark AOR Fund (although lagging as a result of the slow recovery at the beginning of the year):

This week we focus on Tranche 4 that has approximately equal weightings in Equities and TIPs (inflation linked bonds).

Checking the rotation graphs:

we note that VTI (US Equities), while still showing strength in terms of longer term momentum, has now dropped out of the desirable top right quadrant as a result of slowing momentum in the shorter term.

If we check the recommendations from the rotation model:

we see that VTI is now recommended as a Hold, rather than a Buy, with VEA (Developed Market Equities), PCY (International Bonds) and Gold (GLD) showing up as Buy recommendations. If we follow these recommendations, adjustments for next week look something like this:

whereby I will be selling current holdings in VWO and TIP and adding positions in VEA, PCY and GLD.