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You are here: Home / Portfolio Management / Rutherford Portfolio Review (Tranche 5): 6 May 2022

Rutherford Portfolio Review (Tranche 5): 6 May 2022

May 8, 2022 By HedgeHunter 1 Comment

Rutherford Portfolio Review (Tranche 5): 6 May 2022 1

Fisher Island Ferry, Miami, Florida

An unusually wide range week in US equities with the SPX trading in a 4050-4300 point (6%) range – but, at the end of the week, we closed down only ~0.25% from last week’s close:

Rutherford Portfolio Review (Tranche 5): 6 May 2022 2Nevertheless, we are still in the downtrend channel that I drew ~1 month ago and still looking to touch the important 400 (SPY) “round number” at D. However, we could see a little consolidation in the 400-420/405-430 range if volatility settles down a little bit. US Equities are currently down ~14% since the beginning of the year.

Checking how last week’s performance compares with the performance of other asset classes:

Rutherford Portfolio Review (Tranche 5): 6 May 2022 3we see that, other than Commodities, US equity markets held up fairly well (albeit with negative returns). Again, we see that the inverse correlation between equities and bonds is broken – with US long-term treasuries taking the biggest hit – so much for the benefits of diversification for a while.

If we check the performance of the Rutherford Portfolio (heavy red line), although it is struggling to keep it’s head above water, the portfolio is up 0.5% since the beginning of the year – so, not doing too badly on a relative comparison:

Rutherford Portfolio Review (Tranche 5): 6 May 2022 4Current holdings look like this:

Rutherford Portfolio Review (Tranche 5): 6 May 2022 5

Let’s check on current rankings and recommendations from the BHS model:

Rutherford Portfolio Review (Tranche 5): 6 May 2022 6that is still showing only DBC and GLD as Buy or Hold candidates.

Let’s see if the rotation graphs are giving us any more information:

Rutherford Portfolio Review (Tranche 5): 6 May 2022 7and we see that there is not too much positive action either on the longer-term timescale (horizontally) or short-term (vertically).

Checking recommendations from a rotation model:

Rutherford Portfolio Review (Tranche 5): 6 May 2022 8we see a lot of red and only green in the area of DBC.

Although I have reached my maximum planned allocations to DBC and GLD (~25% portfolio value in each) I really can’t see any better option than to sell current holdings in VNQ and RWX (Real Estate – interest rate sensitive) and to invest a little more in DBC. TIP might be an option (with dividend benefits) but I’ll hold back on that idea for another week. I’ll go with the decision to overweight commodities (that includes Oil):

Rutherford Portfolio Review (Tranche 5): 6 May 2022 9David

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Filed Under: Portfolio Management, Portfolio Performance Tagged With: Portfolio Management, Portfolio Performance, Rutherford Portfolio

Comments

  1. HedgeHunter says

    May 9, 2022 at 11:17 AM

    We are presently sitting at that critical 400 “round number” and classic Fibonnaci extension number that I’ve been projecting for a long time – now we wait to see whether we get a reversal or a continuation of the downtrend. I would anticipate some degree of a bounce from here but the markets are not looking strong and with inflation getting alarmingly high (not to mention the political situation in Europe) it’s a little difficult to anticipate a lot of strength.

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