Rutherford Portfolio Review (Tranche 4): 3 June 2022

Maui Sunset

US Equities, as measured by the performance of the S&P 500 Index closed down ~1.1% from last week’s close:

but has stayed above the downtrend channel that it broke out of last week with a weekly 6.6% bullish bounce. However, it looks as though the 415 (SPY) level (previous pivot low level at B) is acting as strong resistance at this point.  We will have to see whether this continues to hold. Implied volatility has dropped significantly over the past couple of weeks and is now back at the ~21% level.

How does this fit in with the performance of other asset classes over the last week?

… right in the middle – with commodities still showing as the strongest asset class and real estate and bonds lagging.

The Rutherford portfolio has held up pretty well – even though I have moved some money to Cash:

so I’ll check on current rankings/recommendations from the BHS model:

where we see that only commodities are showing as a recommended Buy.

Current holdings an Tranche 4 (the focus of this week’s review) are shown below:

where we see holdings in DBC, GLD and AOR.

Let’s check on rotations:

where we don’t see anything too exciting apart from the relative strength of DBC.

Recommendations from a rotation model:

also only show a Buy recommendation for DBC.  So, the decision to be made is whether to sell positions in GLD and AOR and move to Cash or whether to stay where we are with a fair amount of diversification between precious metals, equities and bonds.  I presently have no stop loss orders in place for this portfolio – so one option might be to place TSLOs at this point (even though I don’t like using stop loss orders). However, since the current holdings do provide diversity (and each tranche only represents 20% of the value of the total portfolio) I think I will just save on trading costs and hold current positions as I did last week.

David