Performance Update: Sungarden Core

Here's a snapshot progress report on a key part of my personal portfolio

Photo by Anne Nygård on Unsplash

I don’t write or talk much about this part of my liquid asset portfolio, which is what we offer through the Sungarden Institutional subscription service. We’ll be talking more about it in the coming weeks, as we are working on a video and written presentation series that includes the investment process behind it. After all, it is 40% of the total portfolio included in the service, the largest single segment (YARP dividend is 35%).

This portfolio is all-ETF plus at times I’ll own puts and/or calls (currently only puts) on a major market index. Its first full year of tracking was 2013, though I ran it in various forms going all the way back to the late 1990s, using mutual funds before many ETFs were available. Back when Dana and I started Sungarden the investment advisory firm, Core drew some positive media attention from places like Investment News and others.

Much of the track record is audited and we plan to make it available for review soon. Since selling that advisory practice in 2020, the strategy remained the same, but the only account in the “model portfolio” was mine, since everything I provide is research, not personalized investment advice.

But enough of the industry terminology. For now, here’s a look at what I’m happy to say has been a fairly straight-line move higher in the Sungarden Core Portfolio over the past 15 months. Why point out that period? Because that is when I went from having T-bill ETFs as a chunk of the portfolio to an even bigger chunk. But with Core, a risk-managed bond alternative portfolio, returning a pretty steady 10% rate since last March-end, I think it shows the potential of thinking outside the box as a conservative investor.

Core portfolio performance snapshot

Here’s Core versus a 30% stock / 70% bond “conservative allocation” strategy.

And here is Core versus a 1-3 month T-bill ETF. Translation: even though a sizeable portion of Core relied on short-term Treasuries during this time, there was significant “alpha” (excess return) added. That means that the plan worked well during this period: use the Treasuries as a solid base, allowing me to pursue returns with the rest of the portfolio using my typical tactical, go-anywhere, offense and defense strategy.

Depending on interest from our paid and free subscribers, we can include a live session presenting Core at a high level and then have a Q&A. While we never want to assume there is interest in any particular aspect of our work (Core, YARP, the new Macro Traxx strategy, my charting work, how I use options, etc.), we suspect Core will be an interesting discussion topic in these complex markets.

If you do have interest in learning about Core or any other aspect of what we do in more detail, let us know, and we’ll incorporate the collective feedback in our upcoming summer live series. It won’t be like going to a summer music festival, but I’ll try to find some good intro music on my Spotify!