What the heck is “portfolio management” anyway? In this case, it goes something like this.
Rank the 32 sectors every month. SELL any position no longer in the top 8. Replace with an equal investment in those sectors that replace(d) the ones previously in top 8. There are always 8 positions in the portfolio. The portfolio is ALWAYS 100% invested. We let the profits run, so to speak, relying upon rank order to decide when to sell.
Suggested reading. “A Random Walk Down Wall Street” by Burton Malkiel.
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