On January 3, my Fast Follow Investor (FFI) model made some portfolio adjustments:
January 2023 Allocations
- ~35% International equities (tickers SCZ, VGK)
- ~25% Gold and commodities (tickers GLD, DBC)
- ~40% Cash
A “Santa Rally” never materialized, and December was a down month for U.S. equities. The S&P 500 was down over 2.5%. The Nasdaq ended down almost 5%. Fortunately, I held only a 3.3% position in U.S. equities.
The FFI portfolio was up and down all month, closing the month down 0.3%.
Most January portfolio adjustments were minor tweaks.
The most significant change:
FFI’s cash position increased by 15% after reducing my investment in one international equity ETF (EFA).
My 2022 Performance
For most, 2022 was a difficult (and down) year. It was no different for the Fast Follow Investor portfolio. 2022 ended down 13.1%.
The only good news, if you can call it that, is the standard 60% stock/40% bond portfolio was down 17.6% for 2022.
So, yes, the FFI portfolio fared 26% better. It’s nothing to write home about. But, it does reflect the downside risk protection that Tactical Asset Allocation offers.
When the markets do recover, growth will compound from a higher low. This is rewarding over the long term.
And always remember: The FFI portfolio will never be the top-performing investment strategy in a given year. By design, it cannot be since we wait for an uptrend to buy back in.
Yet, many 2nd and 3rd place finishes added up make for staggering and consistent success.
If you know someone who could learn from my monthly investments or commentary, please point them to fastfollowinvestor.com.
This offer is in no way financial advice. Rather, it is very important financial education!