I’m writing to update you on recent market developments and the adjustments we’ve made to your Portfolio Shield™ strategy for April.
In March, stocks continued their decline as institutional and professional investors sold off holdings. This was driven by uncertainty over tariff impacts and doubts about whether technology firms will see meaningful returns on their substantial AI investments. Against this backdrop of heightened risk, our models have shifted your portfolio into a risk-reduction mode for April.
To adapt, we’ve adjusted the equity allocation by reducing exposure to stocks and introducing a hedged position with long-term bonds. Looking ahead, this hedged stance may persist as we navigate ongoing market uncertainty.
On the equity side, we’ve refined our approach by replacing the equity model’s yield curve criterion with the momentum-based model already proving successful in managing bond allocations. This builds on recent gains from updated momentum signals.
Last month, intermediate-term bond prices rose, while high-yield bond prices fell, with momentum turning negative for the latter. As a result, we’ve shifted your bond allocation entirely to intermediate-term Treasuries for April.
We’re also making steady progress on enhancing the equity allocation. As noted in last month’s update, we’re working toward transitioning Portfolio Shield™ into a dynamic, monthly rotational momentum strategy. With our newly completed back-testing engine, we can now rigorously assess various approaches using historical data to pinpoint the most effective strategies. Our aim is a fully rotational model that stays agile and responsive to market shifts.
The momentum model driving the bond allocation has seen significant upgrades, which we believe will sharpen decision-making—maximizing returns when bond prices rise and quickly pivoting to defensive positions when they weaken.
For April, your portfolio reflects these changes: the equity allocation has scaled back broad market exposure to incorporate long-term Treasuries, while the bond allocation has exited high-yield bonds, fully transitioning to intermediate-term Treasuries across all four bond-holding models.
Please note that all strategies will be rebalanced on the first trading day of each month. Any new funds will be invested according to your selected model at that time. If you wish to change your investment strategy, changes will be implemented at the next rebalance.
Accounts with a zero balance for six months or more will be closed, and, where applicable, advisory agreements terminated.
Currently, we maintain a minimal cash allocation of just 0.3% across all models.
If you have any questions or would like to discuss your Portfolio Shield™ strategy further, please feel free to reach out.
Please inform us of any changes to your financial situation so we may continue meeting your investment needs effectively. Providing accurate and complete information is essential for us to offer appropriate investment recommendations.
Thank you for your continued trust in us to manage your investments with Portfolio Shield™.
Best regards,
Steven Van Metre
