June 17, 2022: We recommend the following changes…

We are recommending the following trades in our Model Fund Portfolio as we continue to take steps to reduce risk in this developing bear market:

• Reduce the MSCI ACWI Ex-US SPDR ETF (symbol: CWI) from 5% to 2%.
• Exit the 2% position in the Invesco S&P 500 Equal Weight Consumer Discretionary ETF (symbol: RCD).

Furthermore, with the +40% gain in the Energy Select Sector ETF and +17% gain in the Direxion S&P 500 Bear ETF in the Model Fund Portfolio this year, we are upwardly adjusting the allocation in these funds to reflect the appreciation which has taken place. Conversely, we are downwardly adjusting the allocation to the technology and health care sectors as they have decreased as a percentage of the Model Fund Portfolio.  In other words, these are “adjustments” to reflect portfolio gains/losses …not changes:

• Adjust the Energy Select Sector ETF (symbol: XLE) from 4% to 6%.
• Adjust the Direxion Daily S&P 500 Bear 1X ETF (symbol: SPDN) from 10% to 12%.
• Adjust the Invesco S&P 500 Equal Weight Technology ETF (symbol: RYT) sector from 9% to 8%.
• Adjust the Health Care Select Sector SPDR ETF (symbol: XLV) from 13% to 12%.

The Model Fund Portfolio now has a net invested allocation of 44% (56% long positions and 12% in an inverse index ETF). The remainder of the Portfolio (32%) is held in short-term Treasurys or a money market fund.