Pismo Beach Pier
The Schrodinger is the Robo Advisor or computer managed portfolio. Schwab calls it an intelligent portfolio. This period of market volatility is an excellent test to see how this Buy-Hold-Rebalance portfolio is performing compared to other investing models used here at ITA. Look for Internal Rate of Return comparisons in a blog I’ll post tomorrow. Since all data is not in for all portfolios the risk ratio data will not provide the same comparisons.
Schrodinger Investment Quiver
Below is the current Schrodinger investment quiver. Schwab finally sold off VB and VOO, two shard ETFs. The cash was used to purchase a few shares of several of the nine ETFs that now make up this portfolio.
Schrodinger Security Recommendations
If one were to apply the LRPC model to this group of ETFs, one would be in cash, TIPs, or a short-term treasury. Since the Schrodinger is not managed using this model the following screenshot only shows what might be rather than what is.
Schrodinger Performance Data
Despite the loss of around 6.0% in April, since 11/30/2020 the Schrodinger continues to outperform the benchmarks of AOR, VTTVX, and VTHRX by comfortable margins. In addition, this portfolio bests the world market (VT), but fall short of the total U.S. Equities market (VTI).
Schrodinger Risk Ratios
Looking back, it would have been a good time to go to cash at the end of 2021. As you will recall, that was an amazing year. 2022 is turning out to be quite different.
The good news is that Jensen’s Performance Index, also known as the Jensen Alpha, is positive and the slope over the past year is also positive. That is the red curve. As I mentioned in the post yesterday, the yield for SHV is up and this in turn drives the Jensen and Treynor values down.
Lowell,
Don’t forget that the IRRs on those VVTX and VTHRX funds is incorrect due to the fact that a HUGE dividend/distribution paid to holders is not included in the data downloaded from Yahoo.
David,
The data is from Quote Media and they have not made the adjustment either. Maybe they never will.
Lowell